West Texas Intermediate crude rose about 3%, up two dollars, to $ 69 a barrel, after falling 1.1% early on Wednesday, while Brent rose by the same percentage to $ 71 a barrel.
Crude oil lost about 7% on Monday, on concern that the fast-spreading delta-coronavirus will continue to constrain the economic recovery. Futures also fell earlier on Wednesday, after the American Petroleum Institute (API) was reported to have reported an 806,000-barrel increase in US crude stocks.
The American Petroleum Institute also reported an increase of 3.31 million barrels in gasoline stocks last week, compared to previous expectations in a Bloomberg survey of more than one million barrels.
Crude oil has fallen since hitting its highest level since 2014 earlier this month, with variable delta outbreaks in parts of Asia as well as the United States and Europe. This challenge coincided with the Organization of the Petroleum Exporting Countries and its allies agreeing to increase production from August.
Goldman Sachs warned that oil will “swing”, and lowered its previous forecast for a price hike to $80 a barrel.
In the latest development in the coronavirus pandemic, the delta variant now accounts for 83% of all cases in the United States, up from 50% in early July.
In Asia, South Korea and Thailand recorded a record number of daily cases, and Japan’s chief health advisor said that new cases in Tokyo, where the Olympic Games are due to start this week, may set a record in August, while Singapore will tighten restrictions from Thursday.
“The damage to reopening from the delta variant has certainly affected sentiment across the board when we look at commodities in general, but specifically at oil markets,” said Wayne Gordon, strategist at UBS AG Wealth Management. “However, we expect that Demand for oil remains relatively strong, and we expect it to continue to recover,” Bloomberg reported.