Citing sources familiar with the matter, Bloomberg reports that China is said to start buying crude for its Strategic Petroleum Reserves, in light of the recent sharp drop in the prices.
Key takeaways
“China is moving forward with plans to buy up oil for its emergency reserves after the epic crash in oil prices over the past few weeks.
Beijing has asked departments to quickly begin filling tanks and options to lock in the current low prices in the market.
Beijing may use commercial space for storage as well - in addition to its state-owned reserves.”
Meanwhile, a Gulf source was reported as saying that Saudi Arabia supports cooperation between oil producers to stabilize the oil market.
Oil price reaction
On the above headlines, both crude benchmarks are extending the early bounce, as WTI regain 21.50 level, up 6.11% on the day while Brent rallies 7.15% to 26.52.
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