The American headline, West Texas Intermediate (WTI) crude, went up by about 32%, selling for $16.33 per barrel by Wednesday afternoon as reports emerged that US would not fill its storage as quickly as previously anticipated.
The Brent crude also went up by over 11% to sell at $22.81 per barrel at the same time. The Nigerian headline crude, Bonny light, went up slightly by 1.23%, selling for $14.85 per barrel.
The storage crisis has persisted, and concerns over that have been the focal point for analysts and traders in the oil market for the past couple of months. This situation has reached a desperate stage globally, with crude carrying vessels being trapped on sea and the facilities hitting full capacity.
Consequently, any positive outcome from the global oil market will always be short-lived, since the massive inventory buildup reported by American Petroleum Institute (API), an unprecedented low demand will not allow sustenance of a price rebound of crude oil.
The anticipated crude buildup of 13.2 million barrels per day as estimated by the API report was almost 3 million barrels less than the 10.6 million barrels that were the actual number.
The oil output cut by OPEC+ and other top oil producers is expected to take off next month, but that may not be enough to have the desired impact to neutralize the effect of the almost 30 million barrels per day drop in demand.