US oil prices rebound above $14 after massive sell-off

US oil prices rebounded above $14 a barrel on Wednesday, a day after a sell-off sparked by a major fund selling its short-term holdings of the commodity amid virus-triggered storage concerns.

West Texas Intermediate, the US benchmark, for June delivery jumped 14.5 percent to $14.13 a barrel in Asian morning trade. It had plunged by more than 21 percent at one point on Tuesday after the United States Oil Fund – a major US exchange-traded fund (ETF) – started selling its short-term contracts of the commodity.

Brent crude, the international benchmark, was trading 3.27 percent higher at $21.13 a barrel. This indicates that traders are bargain hunting after a couple of days of massive sell-offs.

The Oil Fund had sold its contracts due to expire in June to move into longer-dated holdings amid fears about storage space running out in the short term.

Oil prices have fallen to historic lows this month, with WTI crashing deep below zero for the first time as governments worldwide shut down businesses and air travel grinds to a halt due to the virus.

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