UPDATE 1-Oil firms after Trump signs aid bill; demand concerns linger

(Recasts with change in market direction)
By Koustav Samanta and Naveen Thukral
SINGAPORE, Dec 28 (Reuters) - Oil prices edged higher on
Monday after U.S. President Donald Trump signed a $2.3 trillion
coronavirus aid and spending package, although lingering worries
about near-term demand weighed on the market.
Brent crude LCOc1 futures added 12 cents, or 0.2%, at
$51.41 a barrel at 0803 GMT, having fallen as much as 1.5% to
$50.53 a barrel earlier in the session.
U.S. West Texas Intermediate (WTI) crude CLc1 futures rose
18 cents, or 0.4%, to $48.41 a barrel.
"With trading volumes thinned by the holiday week, oil is
likely to remain below the radar in coming days. That said, the
signing of the U.S. stimulus bill, with the possibility of an
increased size, should put a floor under oil prices in a
shortened week," said Jeffrey Halley, senior market analyst at
OANDA.
The U.S. president's move was cheered as it would restore
unemployment benefits to millions of Americans and avert a
federal government shutdown. Global shares climbed on Monday after Trump signed into law
the pandemic aid package, backing down from his earlier threat
to block the bipartisan bill. MKTS/GLOB
But a new highly infectious variant of the coronavirus,
which was first seen in Britain and has now been detected in
several other countries, has led to mobility restrictions being
reimposed, fuelling concern over demand recovery.
The oil market will take cues from the virus situation as it
develops in coming days, market watchers said.
"With the world now urgently launching mass vaccination
programmes, the near-term fate for oil market might be how
quickly vaccines can close the gap in the race to contain the
new variant," Stephen Innes, chief global market strategist at
Axi, said in a note.
"Any complication on the pandemic front, whether its vaccine
logistical, or lockdown related, could be met with more selling
as January oil demand is on less solid footings, especially if
the virus situations worsen more than anticipated post-holiday,
ultimately handcuffing lawmakers."