By Peter Nurse
Investing.com -- Crude oil prices climbed Friday, helped by signs of a global economic recovery, more positive news of vaccines and ahead of a pending supply cut from Saudi Arabia.
By 10:40 AM ET (1540 GMT), U.S. crude futures were up 1.1% at $52.91 a barrel, while Brent futures were up 1.1% at $55.70 a barrel.
U.S. Gasoline RBOB Futures were up 2.5% at $1.6141 a gallon.
Earlier Friday, Germany’s gross domestic product actually rose by 0.1% in the fourth quarter, Spanish GDP grew by 0.6% and while French GDP dropped by 1.3%, this was still better than the 4% drop expected.
This followed the U.S. reporting 4.0% annualized growth in the final quarter of 2020 earlier this week, while last week China’s GDP expanded 6.5% in the fourth quarter of 2020.
Although the Covid-19 virus continues to cause havoc around the world, the economic damage from the second round of lockdowns appears to have not been as bad the first time around.
Additionally, more vaccines are coming onto the market, creating hope that normalcy may be just around the corner. Novavax 's (NASDAQ:NVAX) coronavirus vaccine was 89.3% effective, while Johnson & Johnson's (NYSE:JNJ) one-dose vaccine was 72% effective in the United States, but less potent in other regions.
On the supply side, Saudi Arabia is set to cut output by 1 million barrels per day in February and March, effectively meaning that supply cuts from a group of leading oil producers, known as OPEC+, will rise from 7.2 million barrels a day in January to 8.125 million barrels in February.
That said, these oil gains could face pressure in the future as Saudi Arabia, the world’s largest exporter, is expected to lower its official selling prices for Asian buyers in March, the first cut in three months, according to a Reuters survey Friday.
In corporate news, Chevron (NYSE:CVX) recorded a surprise loss in the fourth quarter, but the oil major still increased its dividend payout for the 33rd consecutive year.
Traders will now look for the release of the latest U.S. oil and gas rig count from energy services firm Baker Hughes, an early indicator of future output. Last week the total rig count was 373.