Oil started the week bullish with investor sentiments boosted by signs of economic recovery from the COVID-19 pandemic in the U.S, and the improved outlook for fuel demand.
Investors are also monitoring the progress of talks to revive a 2015 Iranian nuclear deal that is likely to increase global crude supply.
Brent oil futures gained 0.63% to $66.77 and WTI futures were up 0.63% to $63.98 at the start of the Asian trading session.
Iranian President Hassan Rouhani said during the previous week that the U.S. was “ready” to lift sanctions on the country’s oil, banking and shipping sectors, causing oil prices to fall. “Iran’s oil production has been rising in recent months, likely in anticipation of a lifting of the sanctions,” ANZ analysts said in a note.
Nevertheless, Iranian speaker of parliament Mohammad Bagher Ghalibaf said that the expiry of the three-month monitoring deal between Iran and the U.N.’s International Atomic Energy Agency would cease the latter’s access to images from inside some Iranian nuclear sites. This statement was made on the 23rd of May, 2021. Talks between the two sides continue in Vienna throughout the week.
In the U.S., the spread of COVID-19 continues to slow down, with the country ending its first week since June 2020 with no days of infections exceeding 30,000. Death rates continue to fall in France and Italy, further improving the fuel demand outlook.
Sadly, several countries in Asia continue to deal with COVID-19 outbreaks. In India for example, the country experienced a total number of COVID-19 deaths of 303,720 as of May 24, according to Johns Hopkins University data.
Meanwhile, the Organisation of Petroleum Exporting Countries and allies (OPEC+) have reportedly postponed its Joint Technical Committee meeting, which was scheduled for May 25 to May 31.