Oil prices soared by more than 2% on Monday, with comments suggesting that U.S. President might be discharged from the hospital Monday, a few days after his positive coronavirus test sparked widespread alarm.
This health update eased political uncertainty in global markets and raised Brent 83 cents per barrel, or 2.1%, to $ 40.10 at 06:13 GMT. West Texas Intermediate (WTI) crude oil rose 89 cents, or 2.4%, to $ 37.94 per barrel.
Oil was also backed by a growing labor strike in Norway, which closed Equinor’s four oil and gas fields. According to the Norwegian Oil and Gas Association, the strike could reduce the country’s production capacity by 330,000 barrels of oil equivalent per day, or 8% of its total output.
Prices fell more than 4% on Friday due to uncertainty of President’s health, raising concerns about the growing number of coronavirus cases that could hinder the global economic recovery.
There was conflicting news about the US President’s health over the weekend, but it is said to be recovering overall. Signs of improvement in health condition are balancing indicators of increasing oil supply in the market.
Investors are unhappy that the uncertain US fiscal stimulus scheme could be a concern, which may help recover oil demand.
Libya nearly tripled last week with production reaching 270,000 barrels a day. In this case, if Libya produces an extra half a million (barrels / day) more, it alone completes the fragile supply margin.
Meanwhile, the recent price increases caused some US mills to continue their drilling activities. According to the data, US energy firms are increasing the number of oil and gas rigs for the third consecutive week for the first time since October 2018.
The increase in supply occurred at a time when China’s crude oil imports were slowing, which could drop Brent to around $ 41 in the fourth quarter.