U.S. oil jumped 23% on Thursday, putting it on track for its best day on record, clawing back more than half of the losses from Wednesday’s steep slide.
U.S. West Texas Intermediate crude rose 23.4%, or $4.77, to trade at $25.12 per barrel. International benchmark Brent crude jumped 9.5%, or $2.37, to trade at $27.29 per barrel.
The sharp move higher follows significant losses on Wednesday, which saw WTI drop 24.4% to settle at a more than 18-year low. It was WTI’s third worst day on record.
KKM Financial’s Jeff Kilburg said Thursday’s jump was due to the “rubber band” effect. “Prices are elastic and this is the snap back of a historic oversold condition in WTI,” he said.
Scott Nations, president and chief investment officer at NationsShares, reiterated this point, saying crude was “wildly” oversold.
“Crude was wildly oversold, with a Relative Strength Index which got below 14, the lowest I’ve ever seen for any commodity, and we’ve now decided that maybe the global economy isn’t going to come to an end,” he said.
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Source: cnbc.com | Original Link