Oil hit its highest since in March on Tuesday, rising towards $47 a barrel, as a third promising coronavirus vaccine spurred demand recovery hopes and U.S. President-elect Joe Biden received the go-ahead to begin his transition.
AstraZeneca (NASDAQ:AZN) said on Monday its COVID-19 shot was 70% effective in trials and could be up to 90% effective, giving the fight against the pandemic a third vaccine. This follows positive results from Pfizer/BioNTech and Moderna (NASDAQ:MRNA).
Brent crude rose 45 cents, or 1%, to $46.51 a barrel by 1110 GMT and hit a session high of $46.72, its highest since March 6. U.S. West Texas Intermediate crude gained 47 cents, or 1.1%, to $43.53.
This is Brent’s highest since the collapse of an earlier OPEC-led output pact, just as demand was starting to crater in March due to the developing pandemic, sent prices crashing. Also supporting oil and wider financial markets, U.S. President Donald Trump on Monday allowed officials to proceed with a transition to Joe Biden’s administration.
Expectations that U.S. crude inventories edged lower last week also added support. The first of this week’s U.S. supply reports is due at 2130 GMT from the American Petroleum Institute.
After the previous output pact collapsed leading to a brief Saudi Arabia-Russia price war, OPEC and allies agreed to record high output cuts to support prices.