Oil in London moved back above $40 a barrel, as markets broadly rebounded from Tuesday’s sharp selloff. Futures rose 1.1% after a precipitous slump a day earlier that saw prices settle below $40 for the first time since June 15. While crude rallied along with other risky assets, it also found technical support on Wednesday. Brent dropped a few cents below its 100-day moving average, before turning sharply higher.
Despite the rebound, prices remain below Tuesday’s open. Doubts linger over the strength of Asia’s demand recovery, U.S. consumption is set to ease with the end of the driving season and the easing of OPEC+ curbs on output are weighing on prices. The coronavirus pandemic is still raging and Bank of America Merrill Lynch said it will take three years for oil demand to fully recover from the outbreak even if there’s a vaccine.