Bulls felt a sigh of relief this Wednesday’s trading as prices continue to advance in the market. After a rough couple of days, both Brent oil and crude oil reached green territories.
Oil futures were able to extend their rally after China reported its lowest rate of new cases for the virus. Experts and traders are gaining more hope that the virus will be contained from this point onwards.
Investors are stoked that China is starting to recover which will inevitably lead to oil demand recovery. The coronavirus epidemic has affected fuel consumption in mainland China, the second-biggest oil consumer in the globe.
Brent oil prices are seen up by 3.78% or 2.05 points this Wednesday’s trading sessions. A barrel of Brent oil now trades for about $56.15, a jump from its opening of about $54.17.
Meanwhile, WTI crude oil prices gain about 3.45% or about 1.72 points today. Crude oil prices leapt from $51.65 from their opening of $49.98.
Bulls are looking to extend their rallies even further tomorrow as hopes start to glimmer onto the market.
According to official data from Beijing, the growth rate of new cases slowed down even further. A good sign that the medical and containment measures of the government are working.
However, experts from all around the are advising to remain alert and prepared for what’s to come.
Travel restrictions on flights coming in and out of mainland China have, of course, dented the fuel demand. And as a result of the consumption drop, Chinese refineries are reducing their outputs.
According to reports, productions of two prominent Chinese companies were cut down by about 7%.
Along with slowing demand, the United States Energy Information Administration also slashed its demand forecasts. The EIA eased its projections by approximately 310,000 barrels per day due to the virus.
Traders are hoping for interventions or possible actions from the Organization of the Petroleum Exporting Countries soon. The group is scheduled to have their meeting in early March and the virus is expected to be discussed.