OIL prices rebounded strongly today, a day after US crude hit its lowest level in 18 years, as the European Central Bank (ECB) launched a bond-buying scheme to combat the coronavirus pandemic.

US benchmark West Texas Intermediate was up almost 17% at nearly US$24 (RM105) a barrel, a day after plunging 24%.

International benchmark Brent crude was up 8.5% at US$27 a barrel after slumping 14%.

Oil markets have been hammered due to collapsing demand as Covid-19 prompts sweeping travel restrictions and business closures, and as major producers Saudi Arabia and Russia engage in a price war.

Today’s jump comes as investors buy the commodity at bargain prices, and following ECB’s surprise announcement of a €750 billion (RM3.6 trillion) scheme to purchase government and corporate bonds.

The so-called “pandemic emergency purchase programme” comes just six days after ECB unveiled a stimulus package that failed to calm nervous markets, piling pressure on the bank to open the financial floodgates.

Analysts predicted that oil prices will remain at multi-year lows for some time, however.

“The continued containment and lockdown response of the world’s major economies in response to Covid-19 will advance to a sharp impact on oil demand,” said AxiCorp’s Stephen Innes. – AFP, March 19, 2020.