Oil prices rebound on Wednesday driven by a less-than-expected build in US inventory and tentative talks of extra supply cuts from OPEC producers. The volatility in the oil market has increased to more than ever recently, overwhelmed by a growing supply glut and plunging demand amid efforts to contain the coronavirus pandemic.
US crude inventories increased by 15 million barrels in the week ending April 17, compared to analysts’ expectations of a more than 20 million barrel build. Meanwhile, gasoline stockpiles rose by just 1 million barrels, less than what analysts’ previously estimated.
Saudi Arabia and Iraq on Tuesday separately made comments about their readiness to take extra steps with other producers to restore the oil market balance. OPEC and allies will hold a meeting in June to discuss their next policy. In early April, the group announced to cut supply by 9.7 million bpd, but it seems unable to boost prices.
The international benchmark Brent LCOc1 gained $1.04 (5.4%) to $20.37/barrel, after falling to its lowest level since June 1999 at $15.98 at the earlier session. Meanwhile, US WTI crude CLM0 futures for June delivery surged $2.21 (19.1%) to $13.78/barrel.
