Oil prices have continued to rise persistently despite the uncertainties surrounding world economies recovery after long weeks of shut down, brightening optimism of full rebound up to pre-pandemic prices.
Oil prices hit two months high on Friday after a considerable percentage gain as demand begins to gain momentum in major oil consuming economies such as China and India.
WTI sold at US$29.65pb (June contract) on Friday after gaining 6.79% over the previous price of US$27.88pb
Bonny light have maintained a consistent upswing since May 11 rising from US$25.23pb to the current of US$29.84pb as at Friday after adding whooping 10.68% to US$26.96pb it sold on Thursday May 14th.
Brent crude on the other hand has consistently stayed ahead of the other products in their upward movement. As at Friday, the crude sold at US$32.50pb (July Contract) rising from Thursday price of US$31.13pb after gaining 4.40%.
Analysts have maintained that oil demand will continue to rise in the coming weeks as more economies open obviously due to resuming industrial and road transport sectors, even though the Aviation sector is still down.
OPEC in its fight to keep prices rising is planning to maintain the current oil cut beyond June, Reuters reported last week
“The ministers want to keep the same oil production cuts now which are about 10 million bpd, after June. They don’t want to reduce the size of the cuts. This is the basic scenario that’s being discussed now,” one OPEC+ source told Reuters.
Saudi Arabia equally made a surprise announcement on Monday that it will voluntarily deepen oil supply cuts from June by 1 million barrels per day, saying it wants to expedite draining a global supply glut and rebalancing the oil market.
Gulf OPEC producers the United Arab Emirates and Kuwait have joined Saudi Arabia and pledged fresh cuts for their June output by a combined 180,000 bpd
These pronouncement along with the easing of lockdowns in some countries have created positive effect rise of fuel demand, and are expected to ease pressure on crude storage capacity and shore up prices.