Data From Europe, China Lift Crude Oil
By Adedapo Adesanya
Crude oil prices recovered earlier losses on Monday after data from China and Europe turned the commodity bullish despite spikes in new coronavirus infections threatening the market.
Brent crude rose 58 cents or 1.41 percent to $41.62 per barrel and the United States West Texas Intermediate crude rose $1.11 or 2.88 percent to $39.60 per barrel.
This gain can be attributed to the recovery of economic sentiment in the eurozone which was intensified in June with improvements across all sectors, the European Commission data showed on Monday. According to the figures, overall sentiment rose to 75.7 points in June from 67.5 points in May.
The index crashed in April to its lowest level since measurements started in 1985 as lockdowns closed large sectors of the economy.
In China, profits at industrial firms rose for the first time in six months in May, suggesting the country’s economic recovery is gaining traction. The world’s biggest importer of crude industrial profits for May were up 6 percent from a year earlier, representing the first increase in 2020, official statistics released showed.
With this, Brent crude is set to end June with a third consecutive monthly gain after the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, extended its 9.7 million barrels-per-day (bpd) supply cut agreement into July.
It is also an impressive performance for the US Crude that plunged to the negative territory for the first time in history in April.
But fears of a second wave of the pandemic are keeping prices from going higher. The death toll from COVID-19 surpassed half a million people.
The US leads the world with a COVID-19 case tally of 2.55 million and the death toll of 125,803, more than double the 1.34 million cases and 57,622 deaths recorded in Brazil. Within the US infections have climbed in 32 states over the past 14 days.
Some states in the United States have reimposed restrictions after jumps in cases. California ordered bars to close on Sunday following similar moves in Texas and Florida. Washington state and the city of San Francisco have paused their reopening plans.