Oil Soars on Corona Virus Stimulus Spending

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Udon Map
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Oil Soars on Corona Virus Stimulus Spending

Post by Udon Map » March 19, 2020, 10:58 am

Oil Soars on Corona Virus Stimulus Spending

From Reuters through The Bangkok Post

People exercise outside a tank farm of Brazil's state-run Petrobras oil company in Brasilia, Brazil.
(Reuters file photo)

TOKYO: Oil prices surged nearly 20% on Thursday, bouncing back from days of heavy losses in a relief rally that may yet be short-lived, analysts warned, but which was stoked by economic stimulus efforts to ward off a global coronavirus recession.

Brent crude was up US$2.10, or 8%, at $26.98 a barrel by 0028 GMT (7.28am Bangkok) after tumbling 13% on Wednesday in a third day of relentless selling. US oil gained $3.44, or 17%, to $23.81 a barrel after slumping nearly 25% in the previous session.

"After a 24% crash, oil prices are firming up on some selling exhaustion and as US and European leaders unleash ... aid and stimulus," said Edward Moya, senior market analyst at OANDA in New York.

In the latest move by a central bank to try to halt the spiralling economic and financial crisis sparked by the coronavirus epidemic, the European Central Bank kicked off a 750 billion euro ($820 billion) emergency bond purchase scheme after an unscheduled meeting on Wednesday.

Still, the spread of coronavirus showing no sign of abating. Countries on every continent have resorted to drastic lockdowns, steps to try to tame a virus that has now infected more than 200,000 people worldwide, killing more than 8,000, with a major global recession in prospect.

OANDA's Moya cautioned that the selling could start again in oil markets. "A bottom for oil is not in place, but we could finally see some stabilisation if financial markets can maintain a somewhat constructive tone with all the stimulus that is about to hit," he said.

Courtesy of The Bangkok Post
https://www.bangkokpost.com/world/18820 ... s-spending

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