WASHINGTON (dpa-AFX) - Oil prices rose sharply on Wednesday as positive news on a Covid-19 vaccine continued to boost sentiment and industry data showed U.S. crude inventories dropped more than expected last week.
U.S. West Texas Intermediate (WTI) crude futures jumped 3.3 percent to $42.72 per barrel after climbing nearly 3 percent in the previous session. Benchmark Brent crude futures were up more than 3 percent at $44.97 per barrel.
As several countries report further outbreaks of Covid-19, a vaccine developed by U.S.-based Pfizer and Germany's BioNTech has shown 90 percent efficacy in trials.
Pfizer's vaccine is a very promising on and we expect more and more, WHO director-general Tedros Adhanom Ghebreyesus said on Tuesday and hoped there will be a coronavirus vaccine by the end of 2020.
However, experts cautioned that there are many supply chain hurdles with manufacturing, warehousing, distributing, and administering the Covid-19 vaccines.
The American Petroleum Institute (API) reported on Tuesday a major draw in crude oil inventories of 5.1 million barrels last week, compared with analysts' expectations for a reduction of 913,000 barrels.
The EIA data due out later in the day is expected to show crude inventories down by 3 million barrels last week.
Goldman Sachs said a surge in Covid-19 cases in Europe and the U.S. will hurt oil demand by as much as 3.1 million barrels per day, but it won't stop prices from rebounding over the next 18 months as vaccines emerge.
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