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Oil prices steady as US hopes offset Covid-19 worries

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Efforts of the US to boost its economy from the coronavirus pandemic have increased hopes for robust fuel demand.

Due to this, oil prices remained steady on Tuesday as concerns over surging cases of Covid-19 infections were offset by hopes for more US stimulus.

Brent crude increased $0.02 to reach $43.43 a barrel at 0423 GMT while the US West Texas Intermediate (WTI) crude fell $0.07 to trade at $41.53, reported Reuters.

Both the Brent and WTI benchmarks rose to as high as 0.5% in the earlier session.

“A weaker US dollar is supporting both base and precious metals, but oil traders appear focused on the economic signal that the lower dollar is flashing – i.e. demand destruction.”, CMC Markets chief market strategist Michael McCarthy was quoted by the news agency as saying.

A weaker US currency makes dollar-denominated commodities such as more affordable oil to holders of other currencies because the commodities become cheaper during this time.

The value of the US dollar against six other overseas currencies fell to nearly two-year lows due to a surge in Covid-19 cases in the country.

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