Price of Oil surged to $53 on Tuesday after falling last week as a result of the Coronavirus spread.
Crude Oil Surges To $53 Per Barrel
Global policy makers have pledged to safeguard the market from the Coronavirus while OPEC and its allies are expected to deepen production cuts.
Futures in New York have now recouped almost half of last week’s 16% plunge in a dramatic reversal that’s come amid a broad move upward in financial markets driven by signs major economies will act to soften the impact from the virus.
West Texas Intermediate futures for April delivery rose 2.5% to $47.92 a barrel on the New York Mercantile Exchange as of 10:58 a.m. in Singapore. The contract surged 4.5% on Monday, the most since mid-September.
Brent futures for May climbed 2.3% to $53.09 a barrel on the ICE Futures Europe exchange after a 4.5% jump on Monday. The global crude benchmark traded at a premium of $5.02 to WTI for the same month.
Group of Seven finance ministers and monetary officials will speak by teleconference on Tuesday, while OPEC+ meets in Vienna from Thursday.
All but two of 29 analysts, traders and brokers in a global poll predicted that the Organization of Petroleum Exporting Countries and its allies will announce new curbs, with an average expectation of 750,000 barrels a day.
Whether that’s enough to stabilize the market and rein in oil volatility — which has surged to highest in more than a year — remains to be seen.
“The coordination among global finance ministers and a possible synchronized monetary easing among central banks have raised the level of reassurance in the market,” said Howie Lee, an economist at Oversea-Chinese Banking Corp. in Singapore.
“If OPEC+ cuts production by 1 million barrels a day this week, it will push prices higher in the short term.”
