Oil prices rise on U.S. stimulus hopes

An oil worker removes a thread cap from a piece of drill pipe on a drilling lease owned by Elevation Resources near Midland, Texas, U.S., February 12, 2019. (Reuters)

SULAIMANI (ESTA) — Oil prices were steady on Thursday (October 1) as renewed hopes for U.S. fiscal stimulus provided support but concerns over rising infections hampering fuel demand capped gains.

Brent crude futures climbed 17 cents to $42.47 a barrel at 0636 GMT. U.S. West Texas Intermediate (WTI) crude futures eased 16 cents to $40.37 a barrel.

The U.S. President Donald Trump’s administration has proposed a new stimulus package to House Democrats worth over $1.5 trillion, according to Reuters.

“Even if Trump does sign it must still be approved and originated by the House. Still, it appears progress is being made with the Republicans at $1.5 trillion, and the Democrats at $2.2 trillion,” said Jeffrey Halley, senior market analyst for Asia Pacific of OANDA, Reuters reported.

“Now that we have a market spread, the odds of a compromise have increased dramatically and this will be positive for markets.”

Earlier, U.S. Treasury Secretary Steven Mnuchin said talks with House Speaker Nancy Pelosi made progress on COVID-19 relief legislation, and the House of Representatives postponed a vote on a $2.2 trillion Democratic coronavirus plan to allow more time for a bipartisan deal to come together.

WTI jumped on Wednesday after data from the U.S. Energy Information Administration showed crude and distillate inventories, which include diesel and jet fuel, fell more than expected in the latest week.

But demand worries remain as the pandemic has infected over 7.2 million and killed more than 206,000 people in the United States.

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