Crude climbed a second day after tumbling to a six-year low amid signs the U.S. may allow unfettered exports for the first time in 40 years.
West Texas Intermediate rose as much as 4.3 percent, adding to Monday’s 1.9 percent gain amid a broader rally of U.S. and European stocks. House Democrats are open to lifting the ban on American crude exports if they get adequate concessions in exchange, a Democratic leadership aide said Monday. U.S. crude supplies probably fell last week, according to a Bloomberg survey before government data on Wednesday.
Oil is trading close to levels last seen during the global financial crisis this week after the Organization of Petroleum Exporting Countries effectively abandoned output limits in an effort to defend market share. Repealing the restrictions on shipping U.S. crude overseas could open new markets, buoying the price of domestic crude grades.
WTI for January delivery rose $1.19, or 3.3 percent, to $37.50 a barrel at 1:25 p.m. on the New York Mercantile Exchange. The U.S. benchmark slid below $35 a barrel Monday for the first time since February 2009. The volume of all futures traded was 46 percent above the 100-day average. The gap between WTI and Brent — the North Sea grade used globally — shrank to as little as $1.28 a barrel, the narrowest gap since January.
Brent for January settlement, which expires Wednesday, rose $1.03, or 2.7 percent, to $38.95 a barrel on the London-based ICE Futures Europe exchange. The more-active February contract increased $1.09 to $39.25.