Oil prices rose more than 1 percent on Wednesday as coronavirus vaccine optimism and U.S. stimulus hopes helped outweigh fears of oversupply.

Benchmark Brent crude climbed 1.1 percent to $49.38 a barrel, while U.S. West Texas Intermediate (WTI) crude futures were up 1.2 percent at $46.13.

The White House unveiled a $916 billion Covid-19 relief bill in a final dash to break a months-long logjam over new aid for the coronavirus-stricken U.S. economy.

In a statement on Twitter, Treasury Secretary Steven Mnuchin said he had talked the plan over with Republican leaders as well as Trump and the new proposal includes “money for state and local governments and robust liability protections for businesses, schools and universities.”

The European Central Bank meets Thursday, with analysts expecting the central bank to increase and extend the pandemic emergency purchase program.

On the vaccine front, Britain on Tuesday became the first Western nation to begin a wide vaccination campaign, while Johnson & Johnson said it expects to have results from its final trial for its single-dose coronavirus vaccine in January.

Investors shrugged off industry data showing a jump in U.S. stockpiles. The American Petroleum Institute (API) said on Tuesday that U.S. crude oil, gasoline and distillate stocks rose during the week ending December 4.

There was a build in crude oil inventories of 1.141 million barrels for the week, contrary to expectations for an inventory draw of 1.514 million barrels.

Official weekly oil data from the U.S. Energy Information Administration (EIA) will be out later in the day.

Meanwhile, the U.S. Energy Information Administration (EIA) has revised up global crude oil prices for 2020 and 2021.

In its Short-Term Energy Outlook (STEO), the EIA expects Brent crude to average $41.43 in 2020 recording a 2.1 percent increase compared to the agency’s forecast last month. Brent oil price forecast has been revised up by 4.2 percent to $48.53 for 2021.

The material has been provided by InstaForex Company – www.instaforex.com

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