18.05.202010:18:00UTC+00Oil Prices Jump As Lockdowns Ease

Oil prices jumped on Monday, with U.S. oil futures climbing above $30 for the first time in two months, supported by output cuts and signs of gradual demand recovery.

Global benchmark Brent crude soared 5.4 percent to $34.25 per barrel, while U.S. crude futures were up 6.7 percent at $31.50.

Collective action by the Opec+ alliance, which agreed to cut 9.7 million barrels per day or around 10 percent of global supplies, has offered some relief to a saturated market.

Saudi Arabia, the UAE and Kuwait have pledged to cut even more oil production in June while Riyadh pledged to cut a further 1m bpd, bringing its output to the lowest in 18 years.

The demand for oil has improved with the resumption of economic activity. As more countries ease lockdown measures to re-open their economies, investors expect a recovery in global oil demand.

Italy yesterday recorded its fewest daily deaths since March 9 and its fewest new infections since March 4 in the latest sign that the coronavirus crisis is easing.

Shops, bars and restaurants are re-opening today along with churches such as St Peter's Basilica in the Vatican.

The country will re-open its borders on June 3 and travel restrictions will be lifted in a 'calculated risk' to rescue its tourism industry after the coronavirus crisis. New York and Spain are also gradually removing restrictive measures.