Oil jumps on vaccine hopes and OPEC+ supply signals

LONDON (Nov 9) - Oil jumped by almost 10% on Monday for its biggest daily gain in almost six months after news of a highly effective Pfizer vaccine against COVID-19 and Saudi Arabia’s assurance that an OPEC+ oil output deal could be adjusted to balance the market.

Brent crude LCOc1 rose $3.41, or 8.6%, to $42.86 a barrel by 1302 GMT while U.S. West Texas Intermediate crude CLc1 was up $3.57, or 9.6%, at $40.71.

“Asset prices move faster than the real economy, and oil and other risk assets are reacting positively today to the Pfizer vaccine news,” said BNP Paribas analyst Harry Tchilinguirian.

Pfizer said its experimental vaccine was more than 90% effective in preventing COVID-19, based on initial data from a large study.

Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman said the OPEC+ deal on oil output cuts could be adjusted if there is consensus among members of the group.

The Saudi minister was commenting after being asked whether OPEC+ - which groups OPEC states, Russia and other producers - would stick to existing cuts of 7.7 million barrels per day (bpd) rather than easing them to 5.7 million bpd from January.

Reuters