Oil prices moved higher on Monday amid a flurry of bullish news for the industry, including an upbeat global economic outlook, rising demand for jet fuel and enthusiasm over how congressional passage of President Joe Biden’s $1 trillion infrastructure bill will impact oil demand.
U.S. crude climbed more than 1% to $82.45 a barrel in early trading after opening at $81.34, the Economies.com website reported. Brent crude rose 1.7% to $83.98 a barrel after opening at $82.55. Monday’s rise in U.S. crude followed a 2.5% gain on Friday, lifting prices that had previously fallen to a four-week week low.
Overall oil prices declined 2% last week, Reuters reported, marking the second straight weekly loss as U.S. oversupplies weighed on the market. But price trends are much cheerier this week — at least for oil producers — thanks to the passage of the long-delayed infrastructure bill as well as positive signs for the world economy. Meanwhile, a move by governments to ease air travel restrictions could improve global demand for jet fuel.
Prices also got a boost by the decision last week by the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, to not speed up their planned production increases.
That decision went against the wishes of Biden, who has urged OPEC+ to produce more crude as a way to lower prices. After OPEC+ announced that it would not speed up production, Biden said his administration is looking into other ways to lower oil prices — including releasing part of the U.S. Strategic Petroleum Reserve, an emergency supply that hasn’t been tapped in a decade.
Defenders of the OPEC+ decision say oil prices would be even higher if not for the organization. As Bloomberg reported, United Arab Emirates Energy Minister Suhail Al-Mazrouei said at Monday’s Africa Oil Week conference in Dubai that OPEC+ has prevented the world “from having double or triple the prices, and that’s something we need to appreciate.”
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