By Barani Krishnan
Investing.com -- If you thought oil prices would stay down, think again.
For a second day in a row, crude prices surged, rising almost 4% on Wednesday after a 6% jump the previous session. That set oil up for a week-to-date gain of 6%, after the back-to-back slide of the past two weeks that cumulatively set the market back by 13%.
Global crude benchmark Brent was up $4.03, or 3.9%, at $108.99 per barrel by 2:35 PM ET (18:35 GMT), adding to Tuesday’s 6.3% gain.
New York-traded U.S. crude benchmark West Texas Intermediate, or WTI, finished the session up $3.65, or 3.6%, at $104.25. In the previous session, it rose 6.7%.
Crude prices began their ascent from Tuesday as China rolled back some of its most stringent Covid lockdown measures of the past two weeks, fostering hopes of a pick up in energy consumption in the world’s No. 2 oil consumer.
Oil was also helped in the previous session by the caution from the 23-strong OPEC+ alliance that its non-Russian members cannot — or will not — make up for Russian production lost as a result of Western sanctions.
Wednesday’s rally came on the back of higher U.S. fuel consumption indicated by weekly inventory data released by the Energy Information Administration, or EIA.
Besides the tick-up in automobile and truck fuels such as gasoline and diesel, Delta Airlines (NYSE:DAL) also touted consumer acceptance of higher fares that helped it offset costs, suggesting that demand for jet fuel will be on the rise too.
Adding to the market’s upside were new geopolitical tensions from the Russia-Ukraine conflict, with Moscow warning that any attack on its territory will be reciprocated with strikes at places where such decisions were made, including Kyiv.
“Oil prices are looking very comfortable above the $100 level as U.S. and Chinese demand seems to be heading in the right direction,” said Ed Moya, analyst at online trading platform OANDA.