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Oil Rises For Second Day as OPEC+ Takes Action Against Coronavirus

Oil Rises For Second Day as OPEC+ Takes Action Against Coronavirus

Thursday, 6 February, 2020 - 10:45
FILE PHOTO: Crude oil storage tanks are seen from above at the Cushing oil hub, in Cushing, Oklahoma, March 24, 2016. REUTERS/Nick Oxford/File Photo

Oil futures rose for a second day in a row on Thursday under the effect of potential OPEC+ measure to counter oil demand loss from the coronavirus outbreak.

A technical committee advising OPEC+, which is meeting for a third day in Vienna, may reach consensus on Thursday on the need to further cut oil output by at least 500,000 barrels per day (bpd), two sources said.

Oil prices have slumped more than 20% since reaching their highest this year on Jan. 8 on demand concerns caused by the virus outbreak and indications of oversupply.

Meanwhile, China said on Thursday it would halve additional tariffs levied against 1,717 US goods last year, following the signing of a Phase 1 deal between the two countries, Reuters reported.

The rise of oil futures was also attributed to the easing trade tensions between the world's two biggest economies.

Earlier this week, commodities, equities and other markets have been buoyed by unconfirmed reports of a possible advance in producing treatment drugs for the coronavirus.

Also, commodity supply chains in China have been disrupted to the extent that short-term sales of crude oil, along with liquefied natural gas, fell to nearly zero this week.

The virus has shut down transport and limited industrial activity in China. However, the World Health Organization has played down the reports of "breakthrough" drugs being discovered.

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