SINGAPORE Malaysia
Oil prices extended a rebound Wednesday from
their biggest falls in almost 30 years, as planned US stimulus to combat the
coronavirus epidemic offset worries about a Russia-Saudi price war.
The
two main contracts, West Texas Intermediate and Brent crude, both put on about
four percent in Asian trade before slipping back slightly.
WTI
was trading at about $35 a barrel and Brent at almost $39 a barrel.
Oil
had plunged by almost a third Monday, the biggest drop since the 1991 Gulf War,
after Saudi Arabia heavily slashed prices following a bust-up with Russia over
whether to cut output.
But
prices rebounded by almost 10 percent Tuesday. And on Wednesday prices pushed
even higher, as investors took heart from measures outlined by US President
Donald Trump to combat the economic fallout from the virus outbreak.
The
plans include providing assistance to airlines and cruise companies, two
especially hard-hit industries.
"Oil
investors are taking comfort, and prices are finding support, from the White
House administration plans for economic stimulus," said Stephen Innes,
chief market strategist at AxiCorp.
He
said signs the epidemic was slowing in China - the epicentre of the outbreak -
and hard-hit South Korea had also provided some relief to investors.
Despite
the rebound, investors remain on edge after energy titan Saudi Aramco indicated
Tuesday it would flood the market with crude - and Russia's energy minister hit
back, saying it could also ramp up production.
This week's
rout was triggered by Riyadh driving through the biggest price cuts in two
decades at the weekend, following Moscow's refusal to agree to reduce
production.
Saudi
Arabia and others from oil-exporting cartel OPEC led a push last week to reduce
output further to shore up prices amid slumping demand due to the new
coronavirus.
But
Moscow, the world's second-biggest oil producer, blocked the move - signalling
an alliance with OPEC that was aimed at supporting the market was unravelling. – AFP
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