Oil rose further after the biggest gain since May on growing optimism for more U.S. fiscal stimulus and as President Donald Trump left hospital following treatment for Covid-19.
Futures added 1.2%, following Monday’s surge above $39 a barrel. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin will resume talks on Tuesday on another round of pandemic relief funding, but there’s no sign yet they are close to a deal despite Trump’s urging to get it done. The president will recuperate in the White House after his diagnosis last week roiled markets and pushed oil into the biggest weekly loss since June.
Crude rose on Monday as part of a broader market relief rally, and aided by a strike in Norway that has shut fields and is curbing flows. Masses of people in China are vacationing during the Golden Week holiday, displaying the country’s confidence in its economic rebound and public health measures. But the outlook for global oil demand remains patchy with stricter lockdowns coming into force in parts of Europe.
“This week is shrouded in upside risks, placing demand concerns to the background,” said Kevin Solomon, analyst at brokerage StoneX Group in London. “The promise of fiscal stimulus will continue to be a supporting factor.”
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