Oil prices climb after progress on huge US stimulus bill

Oil prices rose more than $1 on Monday on optimism in the global economy thanks to progress in a huge US stimulus package and on hopes for improving oil demand as vaccines are rolled out.

Brent crude futures for May rose $1.07, or 1.7%, to $65.49 per barrel by 0042 GMT. The April contract expired on Friday.

US West Texas Intermediate (WTI) crude futures jumped $1.10, or 1.8%, to $62.60 a barrel.

Oil prices are recovering this morning in line with most risk assets on the back of the US stimulus bill passing the House and as central banks continue to sabre rattle to ward off market-implied financial tightening.

US House of Representatives passed a $1.9 trillion coronavirus relief package early Saturday. Democrats who control the chamber approved the sweeping measure by a mostly party-line vote of 219 to 212 and sent it to the Senate, where Democrats planned a legislative manoeuvre to allow them to pass it without the support of Republicans.

On the flip side, investors are betting that this week's meeting of the Organization of the Petroleum Exporting Countries (OPEC) and allies, a group is known as OPEC+, will result in more supply returning to the market.

More supply needs to come onto the market to ensure OPEC+ meets incremental demand and keeps internal discipline ducks in a row.