(Bloomberg) -- Oil was trapped in a tight range below $43 a barrel with a surge in coronavirus infections in some parts of the world offset by progress toward a vaccine.
Futures in New York rose as much as 0.8%, reversing Monday’s decline. India saw its Covid-19 fatalities surpass Mexico’s to give it the third-largest death toll globally, while cases in the U.S. topped 6 million, with outbreaks accelerating on college campuses. AstraZeneca (NYSE:AZN) Plc has begun a large-scale human trial of its coronavirus vaccine in the U.S. following a brief delay, according to researchers working on the treatment.
Despite uncertainty over a return-to-normal for oil demand, U.S. benchmark crude futures rose more than 5% in August for a fourth straight monthly gain as prices recover from their plunge below zero in April. Goldman Sachs Group Inc (NYSE:GS). raised its year-end forecast for WTI crude futures to $45.50 a barrel from $40 and Brent to $48 from $43, citing progress on a vaccine and signs of an easing outbreak in the U.S.
U.S. Gulf Coast crude production is coming back online after companies curtailed operations ahead of Hurricane Laura. Disruption due to storms amounted to over half of total Gulf production, down from late last week when it was over 80%, according to data from the U.S. Bureau of Safety and Environmental Enforcement.
The easing of a global supply glut has helped to stabilize prices and Abu Dhabi National Oil Co., the biggest producer in the United Arab Emirates, signaled it may slash output in October to meet the country’s target under a global production-cuts deal.
Meanwhile, oil traders expect Saudi Aramco (SE:2222), the world’s biggest exporter, to react to weak refining margins by slashing Asian pricing of its key Arab Light grade for October shipments by $1 a barrel, according to a Bloomberg survey. That would push pricing below the benchmark used by the Saudis for the first time since June.
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