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Oil prices rose on Thursday but pared early gains as investors tried to assess how effective massive stimulus by central banks will be in shoring up the global economy as the shock from the coronavirus pandemic deepens.
Bucking panic selling in other financial markets, Brent crude LCOc1 was up 37 cents, or 1.1% at $25.25 a barrel by 0355 GMT, having earlier risen to $27.19. The global benchmark slumped 13% on Wednesday in a third day of relentless selling. U.S. oil CLc1 gained $1.44, or 7.1%, to $21.81 after surging nearly 20% earlier. The U.S. benchmark dropped nearly 25% in the previous session.
“After a 24% crash, oil prices are firming up on some selling exhaustion and as U.S. and European leaders unleash aid and stimulus,” said Edward Moya, senior market analyst at OANDA in New York.
Among the latest moves by a major central bank to try to mitigate the spiraling economic and financial fallout from the epidemic, the European Central Bank kicked off a 750 billion euro ($820 billion) emergency bond purchase scheme after an unscheduled meeting on Wednesday.