Skip to main content

US oil rebounds above $14 after massive sell-off

US oil prices rebounded above $14 a barrel on Wednesday, a day after a sell-off sparked by a major fund selling its short-term holdings of the commodity amid virus-triggered storage concerns.

West Texas Intermediate, the US benchmark, for June delivery jumped 14.5 per cent to $14.13 a barrel in Asian morning trade.

It had plunged by more than 21pc at one point on Tuesday after the United States Oil Fund — a major US exchange-traded fund (ETF) — started selling its short-term contracts of the commodity.

Brent crude, the international benchmark, was trading 3.27pc higher at $21.13 a barrel.

Traders "are bargain hunting after a couple of days of massive sell-offs", OANDA senior market analyst Jeffrey Halley told AFP.

ANZ Bank said in a note that the market was hit by volatility on Tuesday "as ETFs and index funds moved contract positions amid renewed concerns of negative prices" in short-term holdings.

The Oil Fund had sold its contracts due to expire in June to move into longer-dated holdings amid fears about storage space running out in the short term.

Following the US ETF's move, Standard & Poor's also told clients to sell their stakes in the June contracts and move them into July, ANZ said.

S&P operates the GSCI commodity index, which is tracked by pension funds and other big investors. Other indices, including the Bloomberg Commodity Index, took similar steps.

Oil prices have fallen to historic lows this month, with WTI crashing deep below zero for the first time as governments worldwide shut down businesses and air travel grinds to a halt due to the virus.

Read: Q&A: Oil prices go negative. What does that mean?

An agreement by top crude-producing nations to cut output by 10 million barrels a day from May 1 has done little to calm the market.

The production cuts "will probably take weeks to show up in the physical market, hence we are still stuck with the inventories issues that will continue to curb any semblance of bullish appetite", said AxiCorp global market strategist Stephen Innes.



from The Dawn News - Home https://ift.tt/2KHHOZZ
via IFTTT
Labels:

Comments

Post a Comment

Popular posts from this blog

Sialkot police bust gang of robbers, seize over Rs20m looted cash

SIALKOT: Police on Tuesday claimed to have busted an infamous gang of robbers and seized Rs20.3 million looted cash from their possession, ARY News reported. A spokesperson for the police confirmed the arrests saying the eight-member gang had looted a pharmaceutical company’s truck full of medicine. He said the looted cash to the tune of Rs20.3 million was also recovered from their possession. The police said the recovered cash and truck have been handed over to their owner. Read More: Youngster battles for life as Punjab police ‘mistakenly’ opens fire on him Earlier, on June 20, Karachi police had apprehended six robbers allegedly involved in a bank robbery of Rs10.5 million last month. The robbers had produced Rs9 million from the bank robbery in front of the police after being taken under arrest. The police also recovered the weapons used by the criminals in the bank robbery. The gang was stated to have a previous record of robbing various places in the city, the police said. ...
Post a Comment
Read more

Peshawar security forces kill four suspected terrorists

The Peshawar Counter-Terrorism Department personnel gunned down four suspected terrorists after raiding their hideout on the Kohat Road Monday. According to the security forces, the suspects were plotting an attack. A cache of weapons and ammunition has been seized too. On Monday evening, a special CTD team raided the hideout after surrounding it and exchanged fire with them. No CTD personnel was injured in the operation. from SAMAA https://ift.tt/2V8MRbn
Post a Comment
Read more

Headlines 9am: Karachi to face power outages, coronavirus cases rise

Here are the headlines from SAMAA TV’s 9am bulletin. Pakistan has begun reporting fewer coronavirus infections in the last couple of days. In the last 24 hours, 3,964 cases were reported with 105 deaths. Around 73,000 recoveries have been confirmed so far. Three people were killed in a collision between a motorcycle and ambulance on the Mehran highway. A child was injured as well. Robbers looted a house in Karachi’s Azizabad in broad daylight and in the presence of a policeman. The cop chased the thieves but they were able to escape. SAMAA TV has acquired a CCTV footage of the robbery. A terrorism bid has been foiled in Peshawar. During a raid, security forces eliminated four terrorists. A cache of weapons and ammunition has been recovered. Saudi Arabia has announced it would hold a “very limited” Hajj this year owing to the coronavirus pandemic, with pilgrims already in the kingdom allowed to take part. The Kingdom has informed Pakistan about it as well. Pakistan’s Religious A...
Post a Comment
Read more