Oil prices up with optimism over easing of lockdowns

By Ovunc Kutlu

ANKARA (AA) - Crude oil prices were up on Tuesday with optimism over the easing of lockdowns in some parts of Asia, Europe and the US, while raising expectations of greater oil demand.

International benchmark Brent crude was trading at $28.59 per barrel at 0640 GMT for a 5.1% increase after closing Monday at $27.20 a barrel.

American benchmark West Texas Intermediate (WTI) was at $22.06 a barrel at the same time for an 8.2% gain after ending the previous day at $20.39 per barrel.

In Asia -India and Thailand, and Europe - Portugal, Spain and Italy have started allowing people to return to work to revive their economies.

In the US, half of the states will soon begin to gradually end restrictions on businesses to contain the spread of the novel coronavirus (COVID-19).

Investors are optimistic that the reopening of major economies will boost oil consumption and push crude prices higher.

However, some analysts believe that it could take at least a year for current low oil demand and oversupply to find a balance in the oil market, and until global air travel returns to normal.

On the demand side, Saudi Arabia and Russia-led OPEC+ oil-producing nations began on May 1 to lower their collective oil production by 9.7 million barrels per day, but it is yet unknown whether this amount will be enough to trim the glut of supply in the market.

Due to COVID-19-related weak global oil demand, crude prices fell to their lowest levels since 1999 with Brent plummeting below $16 per barrel in April.