But analysts warn that demand recovery will still be long and painful: File Image/PixaBay
Oil trading on Friday closed with record monthly gains, due to the one-two punch of falling global production and rising demand in virtually every corner of the world where government is lifting its coronavirus restrictions.
West Texas Intermediate jumped $1.78 to settle at $35.49 per barrel, while Brent gained 4 cents to close at $35.33 per barrel; this contributed to WTI recording an all-time monthly rise of 88 percent after trading negative last month, while Brent increased about 40 percent for its strongest monthly uptick since March of 1999.
Even though media have revived its familiar "new normal" term to describe life in a pandemic world, some thing never change, case in point: a survey found that output from the Organization of the Petroleum Exporting Countries (OPEC) hit the lowest in two decades - but Nigeria and Iraq lagged behind in their contributions.
Tom O’Connor, senior director of petroleum markets, ICF
There is going to be an underlying depression in demand
The cutbacks, which were crucial to the market during the lockdowns, are proving to be painful to Russia: sources revealed that Rosneft has told that country's energy ministry it would be difficult to maintain cuts to the end of the year, as it has had to cut shipments to major buyers such as Glencore and Trafigura despite good demand.
Still, analysts note that while demand is strong in China, the rest of Asia is still struggling and nations in Europe will take time to recover: "There is going to be an underlying depression in demand that is going to be there for some time," said Tom O'Connor, senior director of petroleum markets at ICF.
Oil demand in China plunged by about 20 percent when the country went into lockdown in February; it's since recovered to near pre-coronavirus levels.
With media now in lockstep with health officials in fomenting fear about a potential second wave of virus, the business world - including the hyper-fragile energy market - is worried that concern over infection will facilitate a second round of lockdowns, which most economists - and even a growing number of health experts - agree nobody can afford.
This is especially true in India, where the first lockdown threatened to put 400 million people into poverty (an ease in lockdowns and ramped up testing is seen as a solution if the second virus wave occurs).
In the U.K., former chancellor Philip Hammond told that country's government that "We can't wait until a vaccine is developed, produced in sufficient quantity and rolled out across the population: the economy won't survive that long.
"But we are going to have to do it alongside the measures that are in place to protect the population from Covid."
In the U.S., journalist Paula Froelich wrote that "I am scared of Covid-19, but I am even more terrified about what is coming after the rage of millions tears this country apart, because for many Americans, the lockdown is a luxury they can't afford."
Driving the anger over the first lockdowns and reluctance to entertain a second one is mounting evidence that health authorities are taking a scattershot and contradictory approach to combating the virus: while initially, contradictory directives were explained as the outcome of the medical community not knowing much about the virus, today a great deal has been learned about Covid-19 - but the contradictions continue.
Case in point, around the world experts differ on whether people should be wearing face masks to control the spread of the virus, and the World Health Organization stated that "Masks should only be used by health care workers, caretakers or by people who are sick with symptoms of fever and cough" - yet mask wearing has been deemed mandatory by many policy makers.
The sense that policy makers are merely 'winging it' was highlighted on Friday by Minneapolis mayor Jacob Frey, who gave out masks to rioters in the wake of the George Floyd police debacle, even though he earlier warned that in-person attendance in churches would be a "public health disaster."