Oil Futures Settle Sharply Higher
Crude oil prices surged higher on Monday as strong economic data from China and Japan and hopes about OPEC and allies continuing to curb output helped ease concerns about energy demand outlook.
Encouraging reports on Covid-19 vaccine front contributed as well to oil’s uptick.
Close on the heels of Pfizer’s announcement last week about the phase 3 trial of its virus vaccine proving more than 90% effective, Moderna announced over the weekend that the late stage trial of its vaccine has proved 94.5% effective in preventing the disease.
West Texas Intermediate Crude oil futures for December ended up $1.21 or about 3% at $41.34 a barrel.
Brent crude futures were gaining a little over $1.00 or 2.4% at $43.80 a barrel.
Data from China showed factory output in the world’s second largest economy rose faster than expected in October and retail sales growth accelerated from the previous month, suggesting a broader economic recovery from the coronavirus pandemic.
Elsewhere, Japan’s economy grew at the fastest pace on record in the third quarter, rebounding sharply from its biggest postwar slump.
The Organization of Petroleum Exporting Countries and their allies (OPEC+) are due to meet on Tuesday and it is likely that the cartel will suggest changes to production quotas when all the ministers meet on November 30 and December 1.
For now, OPEC+ is cutting production by about 7.7 million barrels per day, with a compliance rate seen at 101 percent in October.