Oil prices rose 3% on Monday, with several countries announcing that they would start easing public isolation measures linked to the spread of the Corona virus, while the world’s largest producing countries started cuts in crude supplies.
Global demand for fuel fell by about 30 percent in April, largely due to orders to stay at home, and weak fuel consumption is expected to lead to excess supply remaining in the market for months even as major global producers cut production from May 1, But analysts said a swift move from those ends could help reduce supply glut at a faster pace.
Brent crude futures ended the trading session higher, 76 cents, or 2.9 percent, to settle at $ 27.20 a barrel.
US benchmark West Texas Intermediate crude futures rose 61 cents, or 3.1 percent, to settle at $ 20.39 a barrel.
The benchmarks continued to rise in post-settlement trade, extending their gains to more than 5 percent.
“We are supposed to see production cuts begin to emerge … the slow resumption of activity not only in some states here in the United States but also in a few countries in Europe begins to reduce in a way that is Part of some of the demand concerns. ”
American investment bank Goldman Sachs said it was increasingly optimistic about the rise in crude prices next year due to lower crude production and a partial recovery in oil demand.
The bank raised its forecast for the year 2021 for the world price of Brent crude to 55.3 dollars a barrel from 52.50 dollars, and also increased its estimates for West Texas Intermediate crude to 51.38 dollars a barrel from 48.50 dollars in its previous expectations.