On Monday, oil prices rose following Joe Biden’s secured presidency of the US which buoyed risk appetite and offsetting the concerns regarding the impact of the worsening coronavirus pandemic impact on fuel demand.
By 01.01 GMT, Brent crude oil futures for January jumped by 2.1% or 82 cents to USD40.27/barrel while the US WTI for December edged up by 2.3% or 84 cents to USD37.98/barrel.
Following Biden’s emerging as the winner of the US Presidential election on Sunday, prices recovered from the 4% slump on Friday, along with other financial markets.
According to economist Michael McCarthy of CMC Markets, the outcome of the election is ideal from a market point of view as neither of the US two parties controls the Congress, which could help to mitigate the prospect of both trade wars and higher taxes.
At the moment, McCarthy opined, investors’ focus is likely to go back to the resurging coronavirus cases. US President-elect Biden and his team are working on tackling the worsening health crisis.
Meanwhile, US oil output is seen to increase as producers are tapping into a backlog of drilled wells left uncompleted (DUCs) to spur production. According to Baker Hughes, last week the country posted the eighth-week increase of rig count.
