Oil keeps climbing on hopes OPEC+ will hold back supply as COVID-19 cases rise

By Sonali Paul
MELBOURNE, Nov 12 (Reuters) - Oil prices rose in early trade
on Thursday, taking the week's gains to more than 12% on growing
hopes that the world's major producers will hold off on a
planned supply increase as soaring cases of COVID-19 dent fuel
demand.
Algeria's energy minister said on Wednesday that OPEC+ -
grouping the Organization of the Petroleum Exporting Countries
(OPEC) and other suppliers including Russia - could extend
current production cuts of 7.7 million barrels per day (bpd)
into 2021, or deepen them further if needed. The weakening outlook has piled pressure on OPEC+ to delay a
supply increase of 2 million bpd scheduled for January, which
the market is now pricing in, analysts said.
U.S. West Texas Intermediate (WTI) crude CLc1 futures
climbed 35 cents, or 0.8%, to $41.80 a barrel at 0130 GMT, while
Brent crude LCOc1 futures rose 31 cents, or 0.7%, to $44.11 a
barrel.
Both Brent and WTI have soared this week, lifted by hopes
that the global coronarivus pandemic can be brought under
control after initial trial data showed an experimental COVID-19
vaccine being developed by Pfizer Inc PFE.N and Germany's
BioNTech 22UAy.DE was 90% effective. "It's great news, no question about that ... But it will
take time for vaccines to be rolled out, and therefore it will
take time for demand to be positively impacted by that," said
Lachlan Shaw, National Australia Bank's head of commodity
research.
In the meantime, fuel demand is under pressure from rising
infections in Europe, the United States and Latin America. As a
result, OPEC has said demand will rebound more slowly in 2021
than previously thought. "In many ways the market is looking forward into 2021, to a
time when we do have vaccines rolling out, and to a time where
OPEC and allies have held back some of those scheduled supply
increases," National Australia Bank's Shaw said.