Oil prices rose amid optimism about the end of the US shutdown
Kyiv • UNN
Brent crude futures rose to $64.08 a barrel, and US WTI crude to $60.23. This happened amid expectations of a quick end to the US shutdown, which could increase oil demand.
Oil prices rose on Monday amid optimism that the US government shutdown could soon end and boost demand from the world's largest oil consumer, offsetting fears of rising global supplies, UNN reports with reference to Reuters.
Details
Brent crude futures rose 45 cents, or 0.71%, to $64.08 a barrel at 04:26 GMT (06:26 Kyiv time). US West Texas Intermediate crude was at $60.23 a barrel, up 48 cents, or 0.80%.
The end of the historic 40-day US shutdown is entirely achievable, as the Senate moved to vote on reopening the federal government on Sunday, the publication writes.
"A quick resumption of work is a welcome support that will restore the salaries of 800,000 federal employees and resume vital programs that will boost confidence, activity and consumer spending," said IG Market analyst Tony Sycamore.
"This should also contribute to an improvement in risk sentiment across all markets" and lead to WTI oil prices rising to $62 a barrel, he said.
Brent and WTI oil prices fell by about 2% last week, recording their second consecutive weekly decline amid fears of oversupply. OPEC+ agreed to a small increase in production in December but suspended further increases in the first quarter, fearing oversupply.
Oil inventories are also rising in the US, while the volume of oil stored on ships in Asian waters has doubled in recent weeks after increased Western sanctions led to a reduction in imports to China and India, as well as a lack of import quotas, which reduced demand from independent Chinese refineries.
Indian refiners have turned their attention to the Middle East and America to replace sanctioned Russian supplies.
Russian oil producer Lukoil is facing increasing disruptions, with a deadline approaching for companies to cease cooperation with the Russian oil company on November 21, and after an expected asset sale to Swiss trader Gunvor fell through.
US President Trump's decision to grant Hungary a one-year exemption from US sanctions on Russian oil imports has heightened fears of a global supply surplus, Sycamore said.