Light, sweet crude for February delivery was up $1.06 to $38.84 a barrel by midafternoon in Singapore in electronic trading on the New York Mercantile Exchange after trading as high as $39.36. The contract rose overnight 19 cents to settle at $37.78.
Bernanke said Tuesday that a $700 billion financial rescue program being discussed by Congress was needed to combat the worst financial crisis to hit the U.S. and the global economy since the 1930s. The stimulus package "could provide a significant boost to economic activity," he said.
Traders said low volumes in Asian trading also helped spur volatility.
"You're seeing a reaction to Bernanke's comments and an illiquid market retrace toward $40," said Jonathan Kornafel, Asia director for market maker Hudson Capital Energy in Singapore. "We've also come off about $12 without a bounce, so it's a combination of those three factors."
Prices have fallen from as high as $50.47 last week on increased investor concern that a slowing global economy will hurt crude demand.
Investors will be watching for signs of slowing U.S. demand in the weekly oil inventories report to be released Wednesday by the U.S. Energy Department's Energy Information Administration.
The report is expected to show that oil stocks rose 3 million barrels last week, according to the average of estimates in a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos. The department said in last week's report that oil stocks jumped 6.7 million barrels the previous week.
The Platts survey also projects that gasoline inventories increased 1.8 million barrels and distillates gained 1.7 million barrels last week.
Investors are anticipating crude demand may recover, based on the prices of monthly contracts later this year. The May contract, for example, trades at $50.88 a barrel.
"You're seeing the full weight of the demand destruction pulling the front-month February contract lower while any stimulus would have more of an affect further out," Kornafel said.
In other Nymex trading, gasoline futures rose 0.31 cent $1.15 a gallon. Heating oil gained 0.87 cent to $1.52 a gallon while natural gas for February delivery increased jumped 4.1 cents to $5.23 per 1,000 cubic feet.