* Kuwait has already begun reducing oil supply
* Trump asks U.S. Navy to fire on Iranian ships that harass
it
* More government stimulus on the way to support businesses
(Adds latest prices, quote; changes byline/dateline, previous
LONDON)
By Scott DiSavino
NEW YORK, April 23 (Reuters) - Oil soared on Thursday,
extending its rebound after major oil-producing nations said
they would accelerate planned production cuts to combat the
dramatic slump in demand due to the coronavirus pandemic.
Oil prices have had one of their most tumultuous weeks ever.
U.S. West Texas Intermediate crude futures (WTI) CLc1 closed
at negative $37.63 on Monday, in the worst selloff for that
contract in history. Global benchmark Brent crude LCOc1 was
slammed on Tuesday, hitting a two-decade low before rebounding.
Since the start of the year both benchmarks have lost more
than two-thirds of their value. Fuel demand is down about 30%
worldwide in April and supply will outstrip demand for months to
come due to the pandemic.
Brent rose $1.90, or 9.4%, to $22.28 a barrel by 11:53 a.m.
EDT (1553 GMT), while WTI jumped $4.02, or 29%, to $17.80.
The Organization of the Petroleum Exporting Countries and
other oil producing nations, a grouping known as OPEC+, agreed
this month to cut output by a record 9.7 million barrels per
day, around 10% of global supply, to support oil prices, but
prices continued to decline.
Kuwait said on Thursday that it had begun cutting oil supply
to the international market, ahead of the May 1 date when the
deal was supposed to take effect.
Whether that will be sufficient to offset weak demand is
unclear. Rystad Energy cut its forecast for oil demand in 2020
to 89.2 million bpd, a 10% decline from 2019. Last week, the
energy consultant projected demand would fall to 90.3 million
bpd in 2020.
The market was also higher in part after U.S. President
Donald Trump said he instructed the U.S. Navy to fire on any
Iranian ships that harass it in the Gulf, although he added
later he was not changing the military's rules of engagement.
The head of Iran's Revolutionary Guards said Tehran will
destroy U.S. warships if its security is threatened in the Gulf.
"This ratchets up tensions once again between the U.S. and
Iran. However, given the glut we have in the oil market, it is
difficult to see this offering lasting support to the market,
unless the situation does escalate further," ING's head of
commodities strategy Warren Patterson said.
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OPEC's share of India's crude oil imports falls to record low
IMAGE https://tmsnrt.rs/2VuT2XT
Cushing crude stockpiles surge IMAGE https://reut.rs/2XViQxO
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