By Adedapo Adesanya
Oil prices closed the week mixed on Friday despite news surrounding two new vaccines, one from Johnson & Johnson and another from Novavax, raising hopes of more vaccine supply.
On the gaining end was Brent crude futures, which appreciated by 36 cents or 0.65 per cent to $55.89 per barrel, while the West Texas Intermediate (WTI) crude futures lost 24 cents or 0.56 per cent to sell at $52.38 per barrel.
The market in the past few days had faced demand worries over coronavirus variants and slow vaccine rollouts, which offset a bullish sentiment due to a cut in Saudi Arabian oil supply and falling US oil inventories.
But news of more vaccines offered the market succour as Johnson & Johnson reported early Friday that its coronavirus vaccine was 66 per cent effective in preventing moderate to severe COVID-19. It was, however, short of the widely-cited expectations that the vaccine would be at least 80 per cent effective.
Yet, the company also said that the vaccine was 85 per cent effective at preventing severe disease and completely effective at preventing hospitalisation and death from COVID-19.
Novavax is running an additional Phase 3 trial of its vaccine in the US. The company is mulling whether they could submit the drug for emergency-use authorization now or whether they would need to wait for the completion of the US trial. Johnson & Johnson said it planned to file for emergency authorization in early February.
Expectations that supply will be tighter when global oil demand is uncertain, with the continued spread of the coronavirus and new variants in South Africa and the UK also supported the price of oil on Friday.
This is coming as oil giant, Saudi Arabia, is set to begin its pledge to cut an additional one million barrels per day crude out of its production, which is beyond its quota under the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) pact in February and March.
In addition, the US Dollar weakened on Friday, making crude buying cheaper for holders of other currencies.
Analysts continue to warn that the slow vaccine rollout and the still spreading COVID-19 could delay global economic and oil demand recovery further this year.
OPEC oil output rose in January, a survey found, after OPEC+ agreed to an easing of supply curbs.
It was gathered that the rise was less than the amount agreed under the OPEC+ deal, with an involuntary drop in Nigerian exports limiting the increase.
In more forecast about the black gold, prices are expected to remain around current levels for much of 2021 before a recovery gains towards the final quarter of the year.
Modupe Gbadeyanka