The price of oil rose significantly on Tuesday, continuing yesterday's increase. Oil was supported by news from Saudi Arabia, as well as the weakening of the US currency. Investors are also waiting for the speech of Fed Chairman Powell in the hope of getting new clues about the prospects for monetary policy.
Saudi Aramco, the national oil company of Saudi Arabia, raised most of its prices for crude oil, which will be delivered to its main market in Asia in March, amid growing optimism about a steady recovery in demand in China. According to the forecasts of the International Energy Agency (IEA), half of the growth in global oil demand this year will come from China.
Investors are also assessing the potential consequences of new European Union sanctions on Russian petroleum products and how this will affect trade flows.
Interruptions in oil supplies also support prices. Turkey halted supplies to the export terminal in Ceyhan after a strong earthquake, while production at the giant Norwegian Johan Sverdrup field declined due to power outages.
Later today, investors will be closely watching the speech of Fed Chairman Jerome Powell. An increase in interest rates usually strengthens the dollar, which can make oil more expensive for buyers who own another currency.