Oil extended gains from the biggest jump in five months as China’s success in stamping out virus flare-ups boosts optimism of a demand recovery.
U.S. oil futures rose 2.9 percent while Brent topped $71 a barrel. Crude clung to gains after an industry-funded group reported after the close that stockpiles fell last week.
China has rapidly brought local virus cases down to zero and road traffic is showing signs of recovery. The country also reopened its Ningbo port, one of the busiest in the world, after a two-week shutdown.
Covid’s resurgence has interrupted oil’s rally and prompted speculation that OPEC+ may reassess its current plan to return additional barrels to the market when it meets Sept. 1.
Goldman Sachs Group Inc., however, reiterated that the demand impact from delta would be transient , while UBS Group AG sees Brent crude recovering to $75 a barrel on market tightness.