Picture used for illustrative purpose. File

Gulf Today Report 

Oil prices gained on Thursday as a bullish forecast on economic recovery overshadowed the effect of the rise in COVID-19 cases in India, Japan and Brazil.

Brent crude for June rose 42 cents, or 0.6%, to $67.69 a barrel by 06:22 GMT while US West Texas Intermediate crude for June was at $64.22 a barrel, up 36 cents, or 0.6%.

The Organization of the Petroleum Exporting Countries (OPEC) with Russia and their allies, OPEC+, have decided to stick to its plan for the gradual easing of oil production restrictions from May to July.

The group forecasted a 2.95 billion barrel growth of global stocks in July.

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"A closer look at the state of global Oil inventories suggests that the market may be closer to the point of rebalancing than what OPEC+ may think," Citi analysts said, adding that most of the crude inventory overhang has been absorbed by the market although refined products inventories still need to be worked off.

The bank forecasted vaccination campaigns in North America and Europe to boost oil demand to 101.5 million bpd this summer.

According to Howie Lee, an economist at Singapore’s OCBC bank, "the outbreak in India is holding back oil's rally."

"But if India can sort it out and hopefully avert a full lockdown in the process, the market should likely continue its rally," it added.

Meanwhile, US crude inventories rose by 90,000 barrels last week, much smaller than analysts' forecasts for a 659,000-barrel build.