On Tuesday, oil rose in a sign of the longest run of daily gains in more than nine months as the prospect of the output cut due to coronavirus was easing the supply glut.
On the New York Mercantile Exchange, WTI for June delivery climbed by 4.5% to USD21.31/barrel at 08.25 AM GMT+7 after gaining 3.1% on Monday. Since the close on April 28, the contract has rallied by 73%.
On ICE Futures Europe exchange, Brent for July settlement jumped by 2.7% to USD27.92/barrel after rising by 2.9% in the previous session.
Genscape reported 1.8 million barrels of increase in Cushing, Oklahoma, inventories. The reading would be the smallest increase since mid-March if confirmed by government data on Wednesday.
The discount on oil for June delivery relative to July narrowed to the smallest in a month, indicating concerns about over-supply may be easing.
Several major energy companies have announced their plans for output cuts. In the US, ExxonMobil Corp., Chevron Corp., and ConocoPhillips plan to cut up to 660,000 bpd of combined output by end-June.
Another positive factor in oil prices would be the early signs of the bottoming-out demand weakening in some markets.
Nevertheless, the crude consumption recovery might be very gradual and still being weighed down by the escalating tension between the US and China over the origin of the coronavirus pandemic.
