LONDON (Reuters) – Oil prices rose on Friday but were still set for a fourth consecutive weekly loss, as markets attempted to assess the economic damage of the new coronavirus that has spread from China to around 20 countries, killing more than 200 people.
FILE PHOTO: Oil pump jacks work at sunset near Midland, Texas, U.S., August 21, 2019. REUTERS/Jessica Lutz
Brent crude LCOc1 was up 27 cents at $58.56 a barrel by 1050 GMT but still down 3.5% on the week.
U.S. West Texas Intermediate (WTI) CLc1 rose by 23 cents to $52.37 a barrel, but remained down 3.4% on the week.
Both benchmarks rose by more than $1 earlier in the session.
The WHO said late Thursday that the coronavirus outbreak was a global emergency, but calmed the markets by opposing travel restrictions. It said Chinese actions so far will “reverse the tide” of its spread.
“The move has stoked optimism that there may be light at the end of the virus tunnel. This is because the declaration should pave the way for a coordinated international response to control the global spread of the disease,” said Stephen Brennock of oil broker PVM.
However, he added that oil prices will remain vulnerable to downward pressures until China “reverses the virus tide”.
Oil prices were also buoyed by reports that Saudi Arabia has opened a discussion about moving an upcoming policy meeting to early February from March to address the impact of coronavirus on crude demand.
“In our view, there still remains considerable uncertainty on the duration and economic impact of the virus,” said Harry Tchilinguirian, global oil strategist at BNP Paribas in London.
“As such, we are not sure what an emergency February OPEC meeting could effectively deliver other than the usual words of reassurance to the market that producers will act to balance the market.”
China’s New Year’s holiday was due to end on Friday, when many companies planned to get back to work after a week-long vacation, but authorities have ordered businesses in many areas to stay shut longer in a bid to contain the disease.
Widespread travel restrictions, meanwhile, mean millions of migrant workers may be unable to return.
A growing number of airlines are suspending flights to China to help halt the spread of the virus.
Brexit day, which comes three and a half years after the United Kingdom first voted to leave the European Union, is not expected to move markets, analysts said.
Reporting by Bozorgmehr Sharafedin in London; additional reporting by Roslan Khasawneh in Singapore; editing by David Holmes and Jason Neely