CNBC's Brian Sullivan breaks down how oil producers are coping with the loss of demand.

Oil jumped 40% at the high on Wednesday, reversing steep losses after a volatile overnight trading session which saw international benchmark Brent crude fall to its lowest level in more than 20 years.

West Texas Intermediate, the U.S. benchmark, rose $2.92, or 25%, to trade at $14.47 per barrel. Earlier in the session WTI had traded as low as $10.26, before jumping more than 40% to hit a session high of $16.20. Brent crude traded 6.3%, or $1.25, higher at $20.58, after previously breaking below $16.

Given oil’s more than 70% decline this year a smaller gain, of course, now accounts for a much larger percentage move. At the begging of the year WTI fetched more than $60 per barrel, but the fall-off in demand caused by the coronavirus pandemic has sent prices tumbling.

On Wednesday President Donald Trump said in a tweet that he had “instructed the United States Navy to shoot down and destroy any and all Iranian gunboats if they harass our ships at sea.” CNBC’s Jim Cramer said this could have contributed to oil’s surge higher as short sellers covered their positions.

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