By Adedapo Adesanya
Crude oil prices returned to positive territory on Friday after a string of bearish news including fears that fuel demand recovery may suffer some setbacks.
At the trading session, the price of the Brent crude gained $1.25 or 1.98 per cent to trade at $64.53 per barrel, while the West Texas Intermediate (WTI) crude moved up by 2.37 per cent or $1.42 to trade at $61.42 per barrel.
Oil prices had plunged over renewed demand worries as fresh lockdowns to contain the new wave of COVID-19 infections sprung up in European countries.
While fresh lockdowns are being imposed by several countries on the continent, the pace of vaccination programmes has slowed down due to concerns about the AstraZeneca vaccine’s side effects.
However, the World Health Organisation (WHO), alongside the European Medicines Agency, said the vaccines were safe for use and some countries have already announced plans to start back the vaccination programme.
In addition, prices got a boost yesterday after a drone attack struck an oil installation in Saudi Arabia’s capital of Riyadh on Friday, igniting a blaze at the facility deep in the kingdom’s territory.
The dawn attack caused no injuries or damage and did not disrupt oil supplies, according to the official Saudi Press Agency.
The kingdom, which is the world’s largest exporter of oil, is facing more frequent airborne assaults as Saudi-led coalition forces battle Iran-backed Houthi rebels across the southern border in Yemen.
Most recently, drones struck Ras Tanura, the country’s largest crude oil refinery with a capacity of 550,000 barrels a day, raising tensions in the region.
While Houthi-claimed attacks on Saudi Arabia rarely cause damage, strikes on major oil facilities in the kingdom raise the risk of a disruption in world oil supplies.
Moreover, a stronger US dollar is taking a toll on oil prices as a stronger greenback makes crude oil more expensive for holders of other currencies.
Some profit-taking is expected to likely push oil prices down as market participants are focused on the negative short-term signals than the more bullish expectations for robust oil demand rebound later this year.
Modupe Gbadeyanka