Crude oil rose to the highest in more than a week in New York and London on optimism that a deal could still be struck for a fresh round of stimulus spending before the election. The market also drew some support from U.S. stocks which rallied after four weeks of declines, as well as a weaker dollar which makes commodities priced in the greenback more attractive. Yet concerns over the pandemic haven’t gone away and gains were limited by the prospect of renewed lockdown measures to combat the virus.
“The extent to which there’s hope in the market for a deal, that’s trickling through to the petroleum complex,” said John Kilduff, a partner at Again Capital LLC. “It should help demand here.”
“A weaker dollar, a boost in U.S. equities, thoughts that there might be a deal, those are all positive things behind crude oil,” said Phil Streible, chief market strategist at Blue Line Futures LLC in Chicago. Still, “some kind of uptick in demand is needed.”
Supply concerns have also been weighing on the outlook for crude prices. JPMorgan analysts warned against adding oil to the market, as Libya production returns and the OPEC+ alliance looks to its next round of tapering output cuts.
PRICES
West Texas Intermediate for November delivery gained 35 cents to settle at $40.60 a barrel
Brent for November settlement rose 51 cents to end the session at $42.43 a barrel
