THE PESO closed steady on Tuesday on the back of positive sentiment after the largest decline of oil prices to below zero overnight.

The local unit ended trading at P50.79 per dollar, unchanged from its Monday close, according to data from the Bankers Association of the Philippines.

The peso opened the session at P50.83 per dollar. Its weakest showing was at P50.905 while its intraday best was at P50.765 against the greenback.

Dollars traded increased to $381.9 million on Tuesday from the $320.57 million seen on Monday.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the peso’s latest close came on the back of decline in oil prices overnight.

“The peso closed steady after record collapse in WTI (West Texas Intermediate) crude oil futures amid lack of oil storage facilities globally and glut in global supply,” Mr. Ricafort said in a text message.

A trader also attributed the peso’s stronger range trading on Tuesday to the oil price drop.

“This oil price development is a welcome development to us so it led the peso to go back to its range before the knee jerk reaction due to the rate cuts last week,” the trader said in a phone call.

US crude oil jumped more than $20 per barrel on Tuesday but still traded below $0 after plunging into negative territory for the first time in history, dragged down by a supply glut and sagging demand for crude due to the coronavirus pandemic.

US WTI crude for May delivery was up $21.96 at -$15.67 a barrel by 2214 GMT after settling down at a discount of $37.63 a barrel in the previous session.

The May contract expires on Tuesday, while the June contract, which is more actively traded, was up 51 cents or 2.5% to $20.94 a barrel.

Oil prices have been under pressure as travel restrictions and lockdowns to contain the spread of the coronavirus curbed global fuel demand, leaving ample crude supplies hard to find places to store with demand down 30% worldwide.

Faced with a supply glut, the Organization of the Petroleum Exporting Countries (OPEC) and its allies including Russia, known as OPEC+, agreed to cut output by 9.7 million barrels per day (bpd) but that will take place from May.

Mr. Ricafort gave a forecast range of P50.60 to P50.85 while the trader expects the currency to move around the P50.50 to P51. — L.W.T. Noble with Reuters