Algiers – Oil prices experienced a new surge in global markets during trading on Monday, buoyed by renewed optimism regarding economic recovery and ongoing supply constraints.
Brent crude futures rose by 31 cents, or 0.49 percent, to reach $63.65 per barrel. Similarly, West Texas Intermediate (WTI) crude futures in the United States increased by 30 cents, or 0.51 percent, settling at $59.42 a barrel.
The upward trend builds on the momentum from the previous week, where both Brent and WTI saw gains exceeding 3 percent. This marked their most significant weekly increase since October, signaling a potential shift in market sentiment.
Several factors are contributing to the recent price increases. Growing confidence in the global economic recovery, fueled by vaccine rollouts and government stimulus packages, is boosting demand for crude oil. Furthermore, production cuts by OPEC+ nations continue to support prices by limiting supply.
Analysts suggest that while the short-term outlook for oil prices remains positive, potential headwinds exist. Concerns about new COVID-19 variants and their potential impact on economic activity could dampen demand. Additionally, any changes in OPEC+ production policy could introduce volatility into the market.
The Algerian economy, heavily reliant on oil revenues, stands to benefit from these price increases. Higher oil prices translate to increased export earnings, which can support government spending and contribute to overall economic stability. However, Algeria must also continue its efforts to diversify its economy and reduce its dependence on hydrocarbons to ensure long-term sustainable growth.
