Oil rose in London to above $43 a barrel as Saudi Arabia hiked its official selling prices, and as global equity markets climbed.
Brent gained 1.3% in London to near the highest level since March. Saudi Aramco increased its crude prices to Asia as demand recovers. Libya’s oil exports are expected to fall this month as forces opposed to the government continue to block shipments. Global equity markets are near the highest in a month, giving crude another boost.
Still, the surge in coronavirus infections around the world, including in the US, makes the recovery in the oil market fragile. For now though, optimism over strong economic data, returning energy demand as countries ease lockdown measures, and Opec and its allies’ bumper output cuts are driving crude higher.
Saudi Arabia lifted pricing for all of its crudes to Asia by $1 a barrel. Though the increase was less than expected, it’s another sign that demand is continuing to firm in the world’s fastest growing markets.
“Despite the rapid increase in new global cases of Covid-19, financial and commodities markets appear immune to the news,” said Eugen Weinberg, head of commodities research at Commerzbank.
Meanwhile, the World Health Organisation reported the highest number of global virus infections in a single day over the weekend. Iran and Indonesia reported their deadliest days yet, Mexico overtook France with the fifth-biggest outbreak, while India surpassed Russia with the third-highest number of cases.