On Thursday, US crude oil futures opened with a 5% gain from Wednesday’s close despite the intensifying concerns over the world’s economic depression.
US WTI crude futures climbed by USD1.16 to a high of USD21.47/barrel and at 23.02 GMT it soared by 4.8% or 97 cents to USD21.28/barrel.
Analyst of CMC Markets, Michael McCarthy, estimated that US crude futures seemed to have found some technical support around the USD20/barrel mark.
The climb followed Wednesday’s fall after the US crude inventories were reported to stand at 13.8 million barrels last week, the highest weekly increase since 2016.
McCarthy opined that the Thursday increase was also affected by traders switching from Brent to WTI and lowered the discount between the two benchmarks on a view that high-cost US shale producers may have to cut production.
Looking ahead, analysts predict more increases would happen in the coming weeks as refiners consume less crude due to the plummeting demands of gasoline and jet fuel.
Research firm Rystad Energy estimates global crude oil demand in April will fall nearly 23% year on year to 77.6 million bpd.
