Oil prices rise more than $ 1 after a week of turmoil amid viral outbreak By Reuters

By Aaron Sheldrick

TOKYO (Reuters) – Oil prices rose again on Friday, gaining more ground as producers such as Kuwait said they would cut production and the United States approved another package to deal with the economic disruption caused by the outbreak of coronavirus.

Brent () crude rose $ 1.07, or 5%, to $ 22.40 at 0432 GMT, after rising 5% on Thursday. US oil () gained $ 1.12, or almost 7%, at $ 17.62 per barrel, having increased 20% in the previous session.

But barring a sharp jump later in the session, prices are heading for their eighth weekly loss in the last nine, limiting one of the most tumultuous weeks in the history of oil trading. Brent is heading for a 20% loss this week, with the West Texas Intermediate (WTI) in the US. USA Scheduled for a drop of more than 3%.

WTI fell into negative territory at minus $ 37.63 a barrel on Monday, while Brent hit a two-decade low.

“There is little in the way of fundamental developments to support the upward move, although given the amount of weakness recently, it was due to a relief recovery,” ING said in a note.

Under an agreement agreed between the Organization of the Petroleum Exporting Counties (OPEC) and associated producers, including Russia, a group known as OPEC +, production cuts of 9.7 million barrels per day (bpd) will begin From May.

But Kuwait’s state news agency KUNA said on Thursday that the OPEC producer will begin cutting supplies to international markets without waiting for the official start of the deal.

Azerbaijan’s Azeri-Chirag-Guneshli oil project will also have to drastically cut production from May to meet the country’s commitments under the agreement, four sources told Reuters.

Meanwhile, US lawmakers passed a nearly $ 500 billion bill to alleviate the pandemic, supporting small businesses and hospitals. The package brings US spending in the crisis to nearly $ 3 trillion.

While some countries like Germany are beginning to relax restrictions, the global economy may see a record contraction this year, according to a Reuters poll.

“The coronavirus-related disruption will cause the biggest drop in world GDP since World War II,” Capital Economics said in a note, forecasting a 5.5% contraction in world economies this year, dwarfing the 0.5 drop. % observed during the global financial crisis in 2008.

“Once the virus is under control, (economic) production should recover, but it will take years to return to its pre-virus path,” he said.