WASHINGTON (DTN) -- At the beginning of a new trading week, oil futures nearest delivery on the New York Mercantile Exchange and Brent crude traded on the Intercontinental Exchange advanced more than 1%, lifting the international crude benchmark towards $64 per barrel (bbl) amid tentative signs the European Union turned the corner in their response to the pandemic, with Germany and France overseeing a sharp increase in daily inoculations over the weekend, and Federal Reserve Chairman Jerome Powell expressed further confidence in the U.S. economic recovery, adding that growth and job creation will pick up sharply in the months ahead.
Market sentiment is buoyed Monday morning by apparent progress in the eurozone's vaccination efforts, with Germany doubling the number of daily COVID-19 vaccinations and Italy announcing an easing of lockdown restrictions as the contagion rate slows. According to data published by The Robert Koch Institute for Disease Control, more than 15% of Germans have now received at least one dose of a COVID-19 vaccine -- a 25% increase from the previous week. As vaccine supplies ramp up, Europe's largest economy is now on target to comprehensively vaccinate its population by mid-summer, according to Germany's Health Minister Jens Span.
Investors are now beginning to price in Eurozone's demand recovery, with mobility trends finally picking up and consumers eager to spend savings accumulated during months of lockdown. German Economy Minister Peter Altmaier fed those expectations on Friday by calling for more aid to pandemic-hit businesses, including a program to help restaurants, clubs, and hotels to restart after lockdowns unwind.
Domestically, Fed's Powell forecast the economy is about to grow "much more quickly" after a year contending with the pandemic, helped by turbocharged vaccination campaign and deeper public spending from the federal government.
"What we're seeing now is really an economy that seems to be at an inflection point," said Powell Sunday on "60 Minutes."
Last month, the economy added a total of 916,000 jobs, according to recent government figures, topping the most market estimates. Big gains in employment came from industries that were hard hit by pandemic restrictions, including hotels and restaurant businesses. Despite the progress, there are still about 8.5 million Americans who are out work compared to February 2020 levels, which warrants ongoing fiscal support from the Federal Reserve, according to the Powell.
A rising number of new infections in the United States remains a major concern. The U.S. saw 66,533 new infections on Saturday, with Midwestern states experiencing an upward swing in cases, according to Johns Hopkins.
"The principal risk to our economy right now really is that the disease would spread again," said Powell. "It's going to be smart if people can continue to socially distance and wear masks."
In early trading, May West Texas Intermediate futures climbed 79 cents to above $60 bbl and the June Brent contract on ICE advanced 91 cents to trade just below $64 bbl at $63.86 bbl. NYMEX May ULSD futures surged 2.64 cents to $1.8341 gallon and May RBOB futures added 1.86 cents to $1.9807 gallon.
Liubov Georges can be reached at email@example.com