Brent crude prices have surged on Friday from historical lows after U.S. President Donald Trump said he was prepared to intervene in the oil market to support prices.
The international benchmark rose to $29.63 per barrel on Friday at 0707 GMT after it tested below $25 per barrel on Wednesday. The benchmark closed Wednesday at $24.88 per barrel.
American benchmark West Texas Intermediate (WTI) saw a 8.04% gain to $27.25 at the same time compared to Thursday's close.
Although not specifying measures, Trump, at a White House press conference on Thursday, hinted that he would intervene in the oil price war between Saudi Arabia and Russia “at the appropriate time.”
Saudi Arabia and Russia are in conflict after Saudi-led OPEC and Russia-led non-OPEC failed to agree a deal during their latest meeting on March 6 to allow deeper cuts in their oil production levels. The two oil producers are set to ramp up their oil production levels from April 1 onwards.
With Trump's announcement of U.S. plans to buy oil for its strategic reserves, prices were supported and gains were seen on Friday.
Economic recession concerns in markets also continue, limiting price gains. On Thursday, Fitch Ratings announced in its latest quarterly Global Economic Outlook report (GEO) that "the coronavirus crisis is crushing global GDP growth."
According to the GEO, Fitch's baseline global growth forecast for 2020 has been nearly halved to just 1.3% from 2.5%, and its oil price forecast has been lowered to an annual average of $41 per barrel for 2020 from $62.50 per barrel.
"With the collapse of 'OPEC+' co-operation boosting prospects for OPEC supply, we now expect oil prices to average $48 per barrel in 2021 compared to our previous forecast of $60 per barrel," it said.
By Ebru Sengul Cevrioglu