MOSCOW (MRC) -- Crude oil futures edged higher in mid-morning trade in Asia Nov. 8, extending gains from the previous session amid a broad risk-on sentiment in financial markets following a strong US jobs report and news of Pfizer's antiviral drug, reported S&P Global.
At 10:10 am Singapore time (0210 GMT), the ICE January Brent futures contract was up USD1.03/b (1.24%) from the previous close at USD83.75/b, while the NYMEX December light sweet crude contract rose USD1.02/b (1.26%) at USD82.29/b. Both benchmarks had settled higher by 2.7%-3.1% in the last session Nov. 5.
Financial markets across Asia are being buoyed by a stellar US jobs report that showed the US adding jobs at a faster-than-expected pace, boosting hopes of a quick recovery from the COVID-19 pandemic.
US non-farm payrolls jumped 531,000 last month, the Department of Labor said, beating some analysts' forecasts of a 450,000 increase.
"Global risk sentiment received yet another boost after Friday's (Nov. 5) US nonfarm payrolls exceeded market expectations and the October unemployment rate fell to a 19-month low of 4.6%," OCBC Treasury Research analysts said in a note.
"Asian markets are likely to cheer the better-than-expected US labor market data this morning," they added.
Also adding to bullish sentiment was news that pharmaceutical giant Pfizer had stopped a trial for a COVID-19 experimental antiviral pill early after it was shown to cut by 89% the chances of hospitalization, or death, for adults at risk of developing severe disease.
This comes as the US on Nov. 8 reopens its borders to vaccinated travelers across the world, boosting the outlook for jet fuel demand as airplanes prepare to take to the skies again.
The latest developments will add to the overall bullish sentiment in oil prices as analysts maintain that oil markets remain in deficit and prices will continue to be supported going forward.
Market watchers also noted that Saudi Aramco had raised its December official selling prices, announced late Nov. 5, for Asia, Mediterranean, Europe and US-bound cargoes as strengthening Asian demand ahead of colder winter months is expected to tighten crude supplies.
"Saudi Aramco raised its official selling price of crude to all buyers across the globe, suggesting demand remains strong. This comes following OPEC's decision to stick with its scheduled 400,000 b/d increase in output despite consumers saying the current pace is too slow to sustain the post-COVID recovery," ANZ Research analysts Brian Martin and Daniel Hynes said.
As MRC informed earlier, Saudi Aramco's downstream business consumed 43.5% of the company's crude in the first nine months of 2021, while its bottom line for the third quarter to September was in the black amid an improvement in market conditions. During January-September 2020, Aramco's downstream oil consumption stood at 39.5%, the company said in an earnings report released Nov. 1.
We remind that in June 2020, Aramco finalized its USD69 billion acquisition of a 70% stake in Saudi Basic Industries Corp., the Middle East's biggest petrochemical maker. SABIC reported more than a fivefold year-on-year increase in its Q3 net profit to USD1.49 billion thanks to higher average sales prices.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.