Crude oil prices moved higher on Thursday, recovering from losses in the previous two sessions, despite continued concerns about energy demand outlook in the wake of reports showing a surge in new coronavirus cases.
Data showing a bigger than expected increase in U.S. durable goods orders contributed to oil’s uptick.
Uncertainty about the pace of recovery after the IMF report said the global economy will see a more severe contraction this year than earlier forecast weighed on crude oil prices earlier this week.
West Texas Intermediate crude oil futures for August ended up $0.71 or 1.9% at $38.72 a barrel.
Brent crude futures moved up $0.74 or about 1.8% to $41.05 a barrel.
Traders also reacted positively to assurance by White House Economic Advisor Larry Kudlow who said the economy is unlikely to be shut again.
The Commerce Department said durable goods orders spiked by 15.8% in May after plunging by a revised 18.1% in April. Economists had expected durable goods orders to surge up by 10.9% compared to the 17.7% nosedive that had been reported for the previous month.
Excluding a significant rebound in orders for transportation equipment, durable goods orders jumped by 4% in May after tumbling by 8.2% in April. Economists had expected a 2.5% increase.
Despite recent data showing an increase in crude production from U.S. shales, the major oil producers’ compliance with agreed production cuts supported oil’s rise.