Crude oil prices climb by more than 4pc

Business | 22 Jul 2021 7:10 am

Crude oil prices climbed by more than 4 percent Wednesday, extending gains from the previous session as improved risk appetite provided support despite data showing an unexpected rise in U.S. oil inventories, Reuters reports.

Brent crude futures added US$2.88, or 4.2 percent, to settle at US$72.23 a barrel. U.S. West Texas Intermediate (WTI) crude futures gained US$3.1, or 4.6 percent, to settle at US$70.30 a barrel.

Futures are rebounding after dropping around 7 percent on Monday, following a deal by the Organization of Petroleum Exporting Countries and allies, together known as OPEC+, to boost supply by 400,000 barrels per day from August through December.

The sell-off was exacerbated by fears that a rise in infecions of the Delta variant of the coronavirus in major markets like the United States, Britain and Japan would affect demand.

"Overall the OPEC agreement has crystallized what the market should expect as to the restoration of production," said Andy Lipow, president of Lipow Oil Associates.

"However, even according to OPEC+ numbers, it's not enough to stem the overall world oil inventory decline, and to me, that is giving support to the market."

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