TOKYO – Oil prices steadied on Wednesday, following the previous day’s slump, but the recovery was stunted by fears of a slow recovery in demand due to new pandemic lockdowns in Europe and a build in US crude stocks.
Brent crude futures rose 8 cents, or 0.1 percent, to $60.87 a barrel, after tumbling 5.9 percent and hitting a low of $60.50 the previous day.
West Texas Intermediate (WTI) crude futures climbed 8 cents, or 0.1 percent, to $57.84 a barrel, having lost 6.2 percent and touched a low of $57.32 on Tuesday.
Both benchmarks touched their lowest levels since early February on Tuesday and have now fallen nearly 15 percent from their recent highs earlier this month.
The front-month spread for both Brent and WTI slipped into contango, where front-month contracts are lower than the later months, a sign that demand for prompt crude is declining.
“Investors adjusted positions from Tuesday’s sharp selloff,” said Kazuhiko Saito, chief analyst at commodities broker Fujitomi Co.
“But the market sentiment remained bearish due to growing concerns about demand recovery in the wake of new pandemic curbs in Europe,” he said.