NEW YORK: Oil prices rallied as strong German economic data and continued uncertainty about an agreement on Iran’s nuclear program provided lift a day after crude futures tumbled 6 percent.
Brent crude jumped more than 2 percent as European equities strengthened on German industrial output and trade data and also on Greece saying it will pay a loan tranche to the International Monetary Fund.
Brent May crude was up $1.55 at $57.10 a barrel at 12:22 p.m. EDT (1622 GMT), having reached $57.40.
“Huge volatility has been the name of the game in the past few days,” said Carsten Fritsch, senior oil and commodities analyst at Commerzbank.
Brent’s close-to-close price volatility is at levels last seen during the height of the global financial crisis of 2008/2009, Reuters data shows.
US May crude was up 84 cents at $51.26.
Also supportive of prices was Iran saying Tehran will only sign a final nuclear accord with six world powers if all sanctions imposed over its disputed nuclear program are lifted on the same day.
“The German data provided some lift early because it comes even before the expected economic boost from central bank quantitative easing and any sign that an agreement with Iran isn’t going to get done is bullish,” said Phil Flynn, analyst at Price Futures Group in Chicago.
Wednesday’s data showing US crude inventories surged 10.95 million barrels to a record 482.4 million last week, the biggest weekly gain in 14 years, helped limit US price gains.
News late on Tuesday that Saudi Arabia’s production rose to 10.3 million barrels a day (bpd) in March also helped cause crude’s 6 percent tumble on Wednesday.
Iranian oil minister Bijan Zanganeh said in Beijing on Thursday that OPEC would “coordinate itself” to accommodate Iran’s return to oil markets without causing a price crash.
OPEC’s strategy of holding output steady is not working and members should discuss production levels before June’s meeting, Zanganeh said.
Brent crude jumps more than 2%
