Oil prices continued to pick up modestly on Wednesday as Joe Biden was sworn in as the 46th president of the United States and the demand outlook was clear.

North Sea Brent crude oil for March delivery rose 0.32% or 18 cents from Tuesday's close to $56.08.

The US barrel of WTI for the month of February, which is the last trading day, rose 0.49% or 26 cents to 53.24 dollars.

The prices of the two benchmark contracts had earlier approached their latest highs since the end of February 2020 reached last Wednesday ($57.42 and $53.93 per barrel, respectively). They moderated their increase during the session in New York.

“Oil confirmed its momentum with the WTI rebounding above 53 dollars. Market sentiment remains positive, with investors betting on the recovery of demand once vaccines defeat the virus, ending the lockdowns of recent months,” explained Carlo Alberto De Casa, an analyst

- Infrastructure -

Crude prices also rose in the wake of Joe Biden's inauguration. With the arrival of the Democratic president, comes the promise of massive budgetary aid, seen favourably by the markets.

The day before, Janet Yellen, future US Treasury Secretary, had called for “thinking big” in supporting the economy, which was welcomed by investors.

“It's a new day for America and the crude market, and the outlook under his administration is very optimistic,” said Phil Flynn of Price Futures Group.

“Disregard for fossil fuel issues and adoration for climate change will restrict American supply and cause prices to rise,” adds the analyst.

Mr. Biden was due to sign an executive order blocking the controversial Keystone XL pipeline project between Canada and the United States on Wednesday afternoon.

For Christopher Page of Rystad Energy, the arrival of the Biden administration will support prices for other reasons.

It forecasts an increase in American oil demand of about 350,000 barrels per day, “due to the economic recovery expected in the short term and its infrastructure plan.”

This $1.9 trillion stimulus project focuses on financial assistance to low-income American families, extended unemployment insurance benefits, and state supports.

The IEA report published on Tuesday on demand for black gold also showed quite optimistic comments for the strength of the recovery, although it revised its forecasts slightly downwards.

After the close on Wednesday, investors will have American stock estimates from the American Petroleum Institute (API), the federation of petroleum professionals, which are expected to decrease slightly.

The more official weekly report on American oil stocks prepared by the U.S. Energy Information Agency (EIA) will be released on Friday.