Oil in London pared some losses after the biggest plunge in more than two years as uncertainty swirled over how an escalating trade war between the world’s two largest economies will affect demand.
Futures rose as much as 1.9 percent after plunging 6.9 percent on Wednesday. Traders are trying to assess what impact America’s proposed tariffs on $200 billion worth of Chinese goods could have on global economic growth after yesterday’s selloff across risk assets. Meanwhile, U.S. crude inventories shrunk by the most in almost two years, a supportive factor for prices.
Brent for September settlement added 1.6 percent to $74.57 a barrel on the London-based ICE Futures Europe exchange at 2:29 p.m. in Tokyo. Prices on Wednesday tumbled the most since February 2016, dropping 6.9 percent to $73.40. The global benchmark traded at a $5.08 premium to West Texas Intermediate for the same month.
WTI crude for August delivery rose 0.7 percent to $70.87 a barrel on the New York Mercantile Exchange. The contract slumped $3.73 to $70.38 on Wednesday. Total volume traded was about 39 percent above the 100-day average.