Oil rising in price on prospects of increasing demand

Oil extended gains from the highest close in more than two years as optimism over burgeoning US-led demand outweighed concern that Iranian supplies will jump should sanctions on official exports be lifted, Report informs referring to Bloomberg.

As of 8:50 (GMT+4), the price of August futures for North Sea Brent oil blend grew by 0.39 percent, to $69.47, the prices for July futures - by 0.46 percent, to $69.78 per barrel. July futures for WTI oil rose in price by 0.51 percent to $67.19 per barrel.

Oil is on course for another monthly gain in May, the fourth of five this year, as investors wager that progress in combating the Covid-19 pandemic will spur energy consumption. The recovery is most evident in the US, Europe and China, while virus waves continue to roil economies in parts of Asia and Latin America. The rally in crude is part of a broader advance in commodities.

“The momentum is there,” said Howie Lee, an economist at Oversea-Chinese Banking Corp, adding that the recovery in US and Europe is outweighing the concerns over parts of Asia. The market believes the rebound remains strong, and it “will be able to absorb whatever excess supply comes in,” he said.