Crude oil futures jumped 3 percent on Thursday, rebounding forcefully from the three-month lows of this week, as China’s stock market steadied from its collapse and uncertainties remained about a nuclear deal that will allow Iran to export more crude.
Bets of strong gasoline demand through the U.S. summer driving season also fueled the crude rally. Futures of gasoline and ultra-low sulfur diesel rose more than 1 percent.
“We’re up on a host of headlines and the natural rebound that follows a massive sell-off. Fundamentally, nothing’s changed,” said Donald Morton, who runs an energy-trading desk at investment bank Herbert J. Sims & Coin in Fairfield, Connecticut.
Brent crude oil is still down about 7 percent this month, however, thanks to worries about the Greek economy, growing U.S. oil stocks and advancing talks between Iran and world powers that could lead to sanctions relief for its oil exports.
Brent crude was $1.67 higher at $58.72 a barrel by 1:48 p.m. EDT (1748 GMT), rising more than $2 at the session high. It had plumbed an early April low of $55.10 on Monday.
Front-month U.S. crude futures were up $1.18 at $52.83 a barrel, rebounding from this week’s three-month low of $50.58.
Appetite for riskier assets such as oil was buoyed after Chinese equities rebounded 6 percent, helped by Beijing’s frantic attempts to staunch a sell-off that has roiled global markets.
In Vienna, talks for a nuclear accord between Iran and world powers were extended on Thursday for an ninth day beyond their original deadline. Futures were little changed after the White House announced no deal had yet been reached.
Iran is seeking to restore oil exports that have dropped from 2.5 million barrels per day in 2011 to about 1 million bpd in 2014 due to Western sanctions arising from its controversial nuclear program.