NEW YORK: Brent oil futures on Tuesday closed at their highest since early March on hopes the United States is making progress on a new economic stimulus package, as well as curbing the coronavirus spread.
Brent rose 28 cents, or 0.6%, to settle at $44.43 a barrel, its highest close since March 6. US West Texas Intermediate (WTI) crude rose 69 cents, or 1.7%, to $41.70, its highest finish since July 21.
Earlier in the day, both Brent and WTI were trading at their highest since early March. Those price moves came ahead of the release of an industry report later Tuesday from the American Petroleum Institute that is expected to show a decrease in US crude stockpiles last week.
"Crude prices turned positive on stimulus hopes and after another positive round of economic data showed manufacturing recovery continued in June," Edward Moya, senior market analyst at OANDA in New York, said, pointing to better than expected manufacturing data in Asia, Europe and the United States.
Negotiations between congressional Democrats and the White House on a new round of coronavirus relief have begun to move in the right direction, though the two sides remain far apart, the US Senate's top Democrat said on Tuesday.
New US coronavirus cases fell below 50,000 over the weekend for the first time since early July, according to the US Centers for Disease Control.
Despite Tuesday's price rise, traders said crude remained under pressure due to concerns a fresh wave of Covid-19 infections elsewhere in the world will hamper demand recovery just as major producers ramp up output.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, were boosting output this month by about 1.5 million barrels per day. US producers also plan to restart shut-in production.
In Europe and Asia, meanwhile, concerns are growing that coronavirus may be spreading in a global second wave, said Paola Rodriguez Masiu of Rystad Energy.
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