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Oil rises on positive forecasts, slow U.S. output restart

CommoditiesFeb 23, 2021 06:15AM ET
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© Reuters. FILE PHOTO: An employee holds a sample of crude oil at the Irkutsk Oil Co-owned Yarakta field in the Irkutsk region

By Bozorgmehr Sharafedin

LONDON (Reuters) - Oil prices rose on Tuesday, underpinned by the likely easing of COVID-19 lockdowns around the world, positive economic forecasts and lower output as U.S. supplies were slow to return after a deep freeze in Texas shut down crude production.

Brent crude was up 87 cents, or 1.3%, at $66.11 a barrel by 0945 GMT, and U.S. crude rose 68 cents, or 1.1%, to $62.38 a barrel.

"Vaccine news is helping oil, as the likely removal of mobility restrictions over the coming months on the back of vaccine rollouts should further boost the oil demand and price recovery," said UBS oil analyst Giovanni Staunovo.

Commerzbank (DE:CBKG) analyst Eugen Weinberg said the very optimistic oil price forecasts issued by leading U.S. brokers have also contributed to the latest upswing in prices.

Goldman Sachs (NYSE:GS) expects Brent prices to reach $70 per barrel in the second quarter from the $60 it predicted previously, and to $75 in the third quarter from $65 earlier.

Morgan Stanley (NYSE:MS) expects Brent crude prices to climb to $70 per barrel in the third quarter.

"New COVID-19 cases are falling fast globally, mobility statistics are bottoming out and are starting to improve, and in non-OECD countries, refineries are already running as hard as before COVID-19," Morgan Stanley said in a note.

Disruptions in Texas caused by last week's winter storm also supported oil prices. Some U.S. shale producers forecast lower oil output in the first quarter.

Stockpiles of U.S. crude oil and refined products likely declined last week, a preliminary Reuters poll showed on Monday.

A weaker dollar also provided some support to oil as crude prices tend to move inversely to the U.S. currency.

Oil rises on positive forecasts, slow U.S. output restart
 

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Comments (9)
Vlad Lozovskiy
Vlad Lozovskiy Feb 23, 2021 6:58AM ET
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Look at the media.  They are trying to make it sound like it is a great thing! "Oil is UP, thanks to Biden economy is improving!"
Peter Potts
Peter Potts Feb 23, 2021 4:00AM ET
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Oil is on its last leg. 3 years from now oil will be $10 a barrel. Until then it's all market manipulation.
Gene Kret
Gene Kret Feb 23, 2021 2:38AM ET
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Here comes the oil workers slow down over wages.
Silver Bull
Silver Bull Feb 23, 2021 1:00AM ET
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Every single economic hardship is government induced
Steve Lora
Steve Lora Feb 23, 2021 1:00AM ET
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Summer gasoline here was 1.84 to 1.90s. Today here was $2.59
perplexed76 .
perplexed76 . Feb 22, 2021 11:43PM ET
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they say two weeks like it's two years. It's 21 century, time to stop manipulating with crude
Ronald Warren
Ronald Warren Feb 22, 2021 9:53PM ET
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GS says $70 second quarter. MS says $70 third quarter. Looks like $70 by Thursday or Friday!!
Edward Chong
Edward Chong Feb 22, 2021 9:53PM ET
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haha
Dan White
Dan White Feb 22, 2021 9:17PM ET
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Oil companies finally understand it's better for them to produce less and keep prices up.
The Chad Bull
The Chad Bull Feb 22, 2021 9:14PM ET
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Oil prices are rising because of inflation
John Leonard
John Leonard Feb 22, 2021 9:14PM ET
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Buy SCO at open, should see 1-2% decrease in WTI Tomorrow
John Leonard
John Leonard Feb 22, 2021 9:14PM ET
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Saudis Don't want oil over $60 barrel, They will increase production soon if oil continues to to stay above $62.
 
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