WASHINGTON (dpa-AFX) - Oil prices jumped more than 5 percent on Friday after reports that U.S. energy companies are preparing to cut investment and drilling plans because of the plunging prices.
The recovery came along with a rise in global equity markets on hopes the United States would pass a coronavirus economic aid package today.
Benchmark Brent crude jumped 5.3 percent to $34.97 a barrel, after having fallen more than 7 percent in the previous session. For the week, Brent is set to fall around 22 percent.
U.S. West Texas Intermediate (WTI) crude futures were up 5.1 percent at $33.09 per barrel, but remained on track for a loss of about 20 percent for the week.
While Asian markets ended mostly lower today, European stocks rebounded from their worst day on hopes for a U.S. stimulus package and the U.S. Federal Reserve's move to offer $1.5 trillion in short-term loans.
President Trump is in talks with Congress about a stimulus package to support Americans and the economy through the financial turbulence.
The Federal Reserve could slash interest rates to zero in light of the continued growth in coronavirus cases in the U.S. and globally, Goldman Sachs economists predicted today.
Earlier in the day, Norway's central bank reduced the key policy rate in an unscheduled move and said it is ready to lower rates further as it expects a severe hit on the economy from the spread of the coronavirus, or Covid-19.
Elsewhere, Sweden's Financial Supervisory Authority announced that it has lowered the countercyclical capital buffer requirement for banks to 0 percent from 2.5 percent due to the coronavirus impact. This corresponds to a reduction of around 45 billion Swedish kronor.
After a three-way emergency meeting between the government, the Financial Services Agency and the Bank of Japan, Yoshiki Takeuchi, vice-finance minister for international affairs, told reporters today that the government and the central bank will pay close attention to market and economic trends, and take appropriate action as needed to ensure financial stability.
Earlier in the day, the Bank of Japan said that it would buy government bonds worth 500 billion yen ($4.7 billion) to inject money into the markets.
In an unscheduled operation in the afternoon, the central bank said that it would purchase an additional 200 billion yen of Japanese government bonds, with five to 10 years to maturity.
The Bank of Korea said it was considering an emergency monetary policy meeting to discuss an interest rate cut.
South Korea's President Moon Jae-in asked the government to bring forward 'unprecedented solutions', saying the crisis sparked by the coronavirus outbreak could not be compared with previous health alerts such as SARS.
China's central bank lowered the reserve requirement ratio for qualified banks in order to shore up the economy hit by the outbreak of coronavirus epidemic.
The Monetary Authority of Singapore reassured the public that markets are 'functioning normally' and it stands ready to ensure the orderly functioning of financial markets and the stability of the financial system in Singapore.
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