Rising coronavirus infections and Libya supply limited the gains. Crude oil soared on Tuesday as some oil companies stopped U.S. Gulf oil production by 16% or 294,000 barrels per day due to Hurricane Zeta.
Brent crude LCOc1 closed up 75 cents, or 1.9%, at $41.21 per barrel by 1722 GMT. WTI oil CLc1 gained $1.01 cents, or 2.6%, to $39.57.
Both benchmarks fell more than 3% on Monday.
The storm-induced increase in prices is undoubtedly short-lived, with increasing coronavirus cases, demand is expected to weaken again.
There is a lot of negativity. There is no vaccine, no incentives, and a contentious election is approaching in a few days and / but there is an stock exchange that will not react positively.
Libya’s production will result in an excess of 1 million barrels a day in the coming weeks. This will complicate efforts by other OPEC members and allies to restrict production. OPEC plans to increase production by 2 million barrels in January, following production cuts in 2020. This would bring the target overall production cutback to about 5.7 million barrels per day. However, it seems unlikely that weak demand will meet this increase.
Speaking last Thursday, the Russian President declared that he would not object to the cuts extending over a longer period of time.
Weekly US oil inventory figures, to be released late Wednesday, are expected to show increased supply. Analysts expect crude oil inventories to increase by about 1.1 million barrels.