By Peter Nurse
Investing.com -- Crude oil prices pushed higher Thursday, helped by signs of growth in the U.S. economy as the International Monetary Fund validated bets on a solid recovery in demand this year by raising its forecasts for global economic growth.
By 9:50 AM ET (1450 GMT), U.S crude futures were up 1% at $53.35 a barrel, while the international benchmark Brent contract was up 0.8% at $55.97.
U.S. Gasoline RBOB Futures were up 1.7% at $1.5980 a gallon.
The U.S. economy’s growth slowed sharply in the final quarter of 2020, with Thursday’s GDP release showing an annualized growth rate of 4.0%, from a growth rate of 33% in the three months through September.
This meant that the economy closed the year in a relatively solid state despite the turmoil a pandemic and severe political conflict wrought.
The Department of Labor also reported a bigger-than-expected drop in the number of people filing initial claims for jobless benefits last week.
Signs of U.S. growth added to the optimism generated by Wednesday’s official data showing U.S. crude stockpiles fell for the sixth time in seven weeks and the International Monetary Fund revising higher its estimate for world GDP growth to 5.5% from 5.2% previously.
Global oil demand is expected to rise by nearly 7% this year, boosted by quicker vaccine distribution and a better economic outlook, consultancy Wood Mackenzie said on Thursday.
“Our short-term forecast assumes vaccine distribution accelerating through 2021 and is underpinned by 5% expected growth in global GDP, according to our macroeconomic outlook, following the global economy’s 5.4% contraction last year,” said the consultancy’s vice president, Ann-Louise Hittle.
That said, vaccine distribution still remains an issue throughout much of continental Europe, not helped by drug makers AstraZeneca (NASDAQ:AZN) and Pfizer (NYSE:PFE) reporting delays in their supplies. While in the U.S., President Joe Biden’s $1.9 trillion Covid relief package remained stuck in Congress, with bipartisan support apparently difficult to achieve.
Global growth this year could be less than half the World Bank’s 4% estimate if vaccine distribution doesn’t move quickly, warned World Bank Chief Economist Carmen Reinhart on Thursday.