US crude oil stock inventories do not increase as fast as expected and oil prices rose on Thursday amid signs of increased fuel demand that had dropped due to coronavirus.
Brent crude LCOc1 is trading at $ 25.33, up 12.4% or $ 2.79 as of 12:15 GMT. The June front-month contract is expected to expire on Thursday.
The more actively traded July LCOc2 contract is trading at $ 26.49, up $ 2.26 or 9.3%.
West Texas Intermediate (WTI) crude CLc1 rose 16.1% or $ 2.42 to $ 17.48 a barrel. The US oil benchmark rose 22% on Wednesday.
In case this trend continues same in the coming weeks, we can say that we have left the worst market behind us.
China (Sinopec) said on Thursday that the sales of daily refined petroleum products have increased and are now at more than 90% of the levels seen before the coronavirus outbreak.
The International Energy Agency says storage concerns continue to increase, and global capacity can reach its maximum by mid-June, and energy demand may drop by a record 6% in 2020.
If the storage capacity gets loaded over desired every week, it indicates that the problem is not really solved. In this case, an increase in prices cannot be sustainable.
The US administration is said to soon publish a plan to help US oil companies, and this is relating to increasing the capacity of national reserves by millions of barrels.
Norway, the largest oil producer in Western Europe, says it will reduce production between June and December and will support prices by joining other major producers with an action of reducing production for the first time in 18 years.