Oil rose above $56 a barrel on Wednesday, supported by expectations that the new US administration will deliver massive stimulus spending that would lift demand, as well as by OPEC curbs and forecasts for a drop in US crude inventories.
US Treasury Secretary nominee Janet Yellen on Tuesday urged lawmakers to “act big” on pandemic relief spending.
A fall in the dollar after the comments helped oil to rally, analysts said.
“This provided a good backdrop for oil and other risk assets,” said Stephen Brennock of broker PVM. “While the near-term demand environment continues to be gripped by weakness and uncertainty, the future is brightening.” Brent crude was up 61 cents, or 1.1%, at $56.51 a barrel at 1435 GMT, having gained 2.1% on Tuesday. U.S. West Texas Intermediate (WTI) crude climbed 66 cents, or 1.3%, to $53.64.
