Demand for gasoline is recovering from a historic collapse. And that’s lifting oil prices sharply higher.
US crude spiked another 20% to $24 a barrel on Tuesday morning. Oil hit an intraday high of $24.48 a barrel, the highest level since April 13.
Although oil prices remain at depressed levels, they’ve raced back to life since late April on hopes that the worst of the unprecedented decline in demand could be over as some US states begin to reopen.
Gasoline demand in the United States climbed on Monday to the highest level since March 16, according to GasBuddy. Demand is now up 19% from April 6, the lowest Monday for gasoline demand.
The sharp rebound in oil prices is boosting oil stocks, which have been crushed this year by the crash.
All 27 members of the S&P 500 energy sector (XLE) traded higher Tuesday morning, led by 6% spikes by Occidental Petroleum (OXY), Concho Resources (CXO) and Apache (APA). ExxonMobil (XOM) and Chevron (CVX), the largest US oil companies, rallied 3% apiece.
Even President Donald Trump, who normally roots for cheap oil, cheered the recovery in the energy market.
“Oil prices moving up nicely as demand begins again!” Trump tweeted Tuesday morning.