Crude prices rebounded from selloff; lifted by strong economic data from Germany and the ongoing uncertainty about Iran’s nuclear accord.
Brent and West Texas Intermediate, the European and American benchmarks respectively, clawed back after recording losses of more than 6% on Tuesday after reports of ballooning inventories.
Light sweet crude for May delivery inched up by 83 cents or 1.7% to trade at $51.25 a barrel on the New York Mercantile Exchange.
The US benchmark Shrugged glut worries after Iran’s President Hassan Rouhani said that they would only sign the framework of the agreement with the world powers to clip its nuclear program after all economic sanctions were lifted.
“The Iranian president’s statement about needing sanctions to be lifted before implementing a nuclear deal seems to have to have sparked some buying,” Gene McGillian, a senior analyst at Tradition Energy in Stamford, Connecticut, told Bloomberg by phone.
“The market is showing surprising strength given how huge supply and production are here.”
Brent futures, the global benchmark, gained $1.55 or 1.7% to trade at $57.10 on the London-based ICE Futures.
Brent fell to the bottom of its $55 to $60 trading range yesterday and has consequently turned higher,” said Carsten Fritsch, senior oil and commodities analyst at Commerzbank, told Fox Business.
“Huge volatility has been the name of the game in the past few days,” Fritsch added.
Also supportive was the strengthening of European equities on robust German industrial output and Greece announcing that it was planning to pay a loan tranche to the IMF.
“The German data provided some lift early because it comes even before the expected economic boost from central bank quantitative easing and any sign that an agreement with Iran isn’t going to get done is bullish,” said Phil Flynn, analyst at Price Futures Group in Chicago.
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