Oil rises, with support from the International Energy Agency raising demand expectations

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NEW YORK (Reuters) – Oil prices increased by more than two percent on Friday after the International Energy Agency raised its forecast for demand in 2020, but record-breaking cases of the Coronavirus in the United States undermined expectations for a rapid recovery in fuel consumption.

An oil pump in Texas, with a photo from Reuters archive.

Prices were also supported after data showed that US energy companies reduced the number of operating oil and gas rigs to a record low for the tenth week in a row.

And Brent crude was settled, up 89 cents, equivalent to two percent, to $ 43.24 a barrel, and US crude was settled at an increase of 93 cents, or 2.4 percent, to $ 40.55 a barrel.

Oil prices also supported stocks rally. A batch of economic data indicated a recovery in US business activity in June.

On a weekly basis, US crude remained little changed, while Brent made a weekly gain of about 1 percent.

The Paris-based agency raised its demand forecast to 92.1 million bpd, up 400,000 bpd from its forecast last month, attributing this to a lower-than-expected pace in the second quarter of the year.

More than 60,500 new cases of Covid-19 were announced in the United States on Thursday, setting a new record. The number is also the largest daily for any country since the virus appeared in China late last year.

Prices had fallen earlier in the session after the National Oil Corporation of Libya announced that it had raised the state of force majeure it imposed on all oil exports, after half a year of blockade by forces from the east of the country.

Oil stocks are still in glut due to the dissipation of the demand for gasoline, diesel and other fuels during the initial outbreak of the pandemic.

US oil stocks rose by nearly six million barrels last week after analysts expected it to drop by about half of that number.

Prepared by Mahmoud Salama for the Arabic Bulletin





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