US oil rallies second day, WTI up 6.3%

GMT 20:08 2015 Friday ,28 August

Arab Today, arab today US oil rallies second day, WTI up 6.3%

US oil prices
New York - AFP

US crude-oil prices surged higher for a second straight day Friday, as investors appeared to view the recent nose-dive as overdone.

The US benchmark West Texas Intermediate crude for October delivery jumped $2.66 to finish at $45.22 a barrel on the New York Mercantile Exchange.

On Thursday WTI prices rocketed 10.3 percent, rebounding from more than six-year lows.

Over the week, the US contract has gained 11 percent, its strongest weekly increase in four and a half years. That came despite WTI falling Monday to its lowest close in six and a half years, at $38.24 a barrel.

"It's just incredible," said Phil Flynn of Price Futures Group. "The reason why oil prices have come back is we're feeling the sell-off was overdone."

"Most of the sell-off wasn't about demand destruction but fears of future demand destruction. When oil prices went below $40 a barrel, that was a signal people thought that because of China, the global economy was going to grind to a halt," he said.

"But now, you look at the economic data that's coming from both Europe and the US, those fears that the China slowdown is having a big impact on the global economy are probably overstated."


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