Oil prices gain ground on hopes of re-opening after coronavirus crisis

As lockdowns across the European, and Asian countries along with several US states begin to ease, prices of crude oil are surging yet again in the international markets.

The prices of Brent future, which has now surged past $30 a barrel for the first time since April 13, recorded its rise for the sixth consecutive day on Tuesday -- surging by 46.4%. At the time of filing this copy, the Brent crude was trading at $30.41 a barrel.

On the other hand, WTI futures, that have now reclaimed the $20 a barrel mark after dramatically crashing into negative prices, rose by 62% in the past five days. WTI crude was trading at $24.03 a barrel, up 18% in a single trading session on Tuesday.

The oil prices have moved up in the past week in anticipation of increased demand, as countries look at reopening their economies.

In an extraordinary turn of events, crude oil prices had crashed dramatically into negative territory in late April. At its lowest, the price of oil futures for May fell to minus (-) $40.3 a barrel, falling by over 300% in a single day, the steepest in the history of oil.

However, despite this correction in oil prices, the petrol prices at pump stations in most of the cities remained unchanged despite a huge slump in crude oil prices.

While Delhi hiked the prices of petrol on Tuesday, it has remained constant at Rs 73.55 a litre for a month in Bengaluru. When the prices of crude oil fall, the government sees it as an opportunity to shore up its revenues. The cost of making petrol is just one-third of its price in the retail market. The taxes on petrol and diesel hike it up. The government has resorted to increasing the taxes to keep the pump prices at existing levels.