By Barani Krishnan
Investing.com - Oil settled up about 1% or more on Friday, ending up with its worst week since the financial crisis, as investors braced for a recession amid declaration of a U.S. emergency by President Donald Trump to deal with the coronavirus crisis. But prices got a late boost from the president after settlement.
Trump, speaking from the White House Rose Garden, said that his administration intended to stock up the U.S. Strategic Petroleum Reserve, with prices being so low.
"We're buying it at the right price and that's something that would have not been possible a week ago," Trump said. "The price of oil went down quite a bit. So, we're going to fill it up."
West Texas Intermediate, the New York-traded benchmark for U.S. crude prices, settled up 23 cents, or 0.7%, at $31.73 per barrel. For the week, WTI lost 25%, its most since December 2008, when the Great Recession was underway.
Brent, the London-traded global benchmark for crude, gained 63 cents, or 1.9%, to settle at $33.85. For the week, Brent also fell 25%, its most since the financial crisis.
Post-settlement, WTI jumped 6.1% and Brent gained 6.2% following Trump's pledge to buy crude.
During the week, investors saw little chance ahead for oil demand, especially with Saudi Arabia’s dogged determination to flood the market with crude after the collapse of the OPEC+ production cuts pact.
“Coronavirus is just getting its claws into Europe and is in the early stages of spreading in the U.S., so the week ahead will inevitably bring more disruptions on both sides of the Atlantic,” said Matt Weller, global head of market research at GAIN Capital in Bedminster, N.J.
The CME Group (NASDAQ:CME), which operates the NYMEX exchange where WTI trades, commented on Friday that there was no certainty on how long the crisis in oil would drag given the resolve of Saudi Arabia to grab market share from Russia and U.S. crude exporters.
“The major oil powers of Russia, Saudi Arabia, and the U.S. are now engaged in a test of their oil economics and energy dominance,” the CME said. “We will see who blinks first.”