Monday's historic price crash for U.S. benchmark WTI crude -- which hit negative $37.63/barrel -- sent shockwaves through the industry and across Wall Street. But it didn't last long: By Thursday morning, WTI crude prices had rebounded sharply, hitting an intraday high of $18.15/barrel. That was up 68.4% over Wednesday's opening price of $10.78/barrel.
U.S. oil stocks rose to varying degrees on the price rebound. Shares of oil driller Apache Corporation soared more than 12% in morning trading, while integrated oil major ExxonMobil saw a more modest 5% gain.
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On a technicality
Monday's negative oil prices were mostly caused by a short-term oil storage crunch.
It's all a bit technical, but basically, Tuesday represented a deadline to find a place to store crude oil. However, thanks to the coronavirus-induced drop in demand, most storage was already full. So instead of selling their crude oil, investors had to pay almost $40/barrel to convince someone with storage to take it off their hands.
By Wednesday, that deadline had passed, which is why prices are no longer negative. However, that doesn't explain the jump in prices from Wednesday to Thursday.
Possible reasons
Some analysts attributed the increased WTI crude prices to a belief among energy investors that this week's historically low prices will prompt further production cuts, leading ultimately to higher oil prices.
Others pointed to a Wednesday tweet by President Donald Trump that seemed to threaten Iran. Instability in the Middle East often leads to higher oil prices. A slight drop in initial U.S. jobless claims, reported Thursday, and optimism about a potential partial reopening of the U.S. economy may also have been factors.
