Oil prices jump as Colonial Pipeline restarts operation; pandemic concerns cap gains

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Oil prices jump as Colonial Pipeline restarts operation; pandemic concerns cap gains

On Friday, both US and UK crude oil futures’ prices feathered higher, paring some of their steeper plunges a session earlier, as global equity markets bolstered and American currency slipped following reveal of a pause in US retail sales in April that partially de-escalated inflation jitters, though gains in both contracts were largely curbed amid a second wave of pandemic outbreak in some part of the world, however, daily pandemic cases in India had reported a decline along with Iran and Japan, spurring up hopes that the latest wave of outbreak had reached a phase of plateau.

If truth is to be told, in the day’s sharp rises in crude oil contracts' prices were almost entirely prodded by a Colonial Pipeline statement made late on Thursday that said the major US pipeline operator funnelling oils from Gulf refineries to US East Coast, which had reportedly paid off a ransom of $5 million to unshackle its network from a hacking attack took place earlier in the week, had resumed its entire pipeline system and restarted deliveries in all markets.

Nonetheless, despite a restart of Colonial Pipeline’s operation, gas outage in the US Capital surged to 87 per cent on Friday, up from a 79 per cent a day earlier, an energy tracking firm GasBuddy had unveiled.

Oil rises as Colonial Pipeline resumes operation

Citing statistics, in the day’s commodity market wind-down, UK crude futures gained as much as 2.3 per cent to $68.50 a barrel, while US West Texas Intermediate (WTI) crude oil contracts jumped 2.3 per cent to $65.27 per barrel.

Both contracts dived more than 3 per cent on Thursday. On the week, US WTI crude oil contracts clocked an increase of 0.97 per cent, while Brent crude rose 0.91 per cent. Meanwhile, citing that a supply-drive in the United States following a week-long stagnation had eclipsed concerns on latest pandemic situation, a senior analyst at Price Futures Group in Chicago, Phil Flynn said, “Oil is rallying because supply is moving again, whether it is through the pipeline or the Mississippi river. Tempering the excitement is ongoing concern about COVID cases….