Oil extends gains but stays below USD 30

Oil rose further Friday after a dramatic rebound from multi-year lows but stayed below USD 30 a barrel on fears the deadly coronavirus will push the world into recession with an oversupply.

US benchmark West Texas Intermediate (WTI) was up 3.65 per cent to USD 26.14 a barrel in midday Asian trade.

Brent climbed 2.14 per cent to USD 29.08 a barrel.

On Thursday, WTI rebounded by more than 23 per cent following US government moves to help American crude producers weather a slump in demand caused by the coronavirus pandemic, recovering almost as spectacularly as it had plunged in recent days.

Crude slumped to 18-year lows Wednesday, with travel restrictions and other measures aimed at combating the virus hitting demand and major producers Saudi Arabia and Russia locked in a price war by ramping up production.

"Oil prices are recovering... as the three-day collapse saw some bottom fishing after WTI failed to break the USD 20 a barrel level," said OANDA senior market analyst Edward Moya.

"The oil rebound also extended higher after (US) President (Donald) Trump stated he would get involved in the oil price war at the appropriate time," Moya said in a note.

"The Trump administration is now showing signs they will try to defend the shale industry and stabilise oil prices."