Oil increases losses as fears of a recession grow

West Texas Intermediate (WTI) oil futures fell $ 2.39, or 2.3%, to $ 103.80 a barrel at 00:31 GMT. Brent oil futures fell $ 2.24 or 2.0% to $ 109.50 a barrel.

Both benchmarks fell by about 3% on Wednesday to their lowest levels since mid-May.

Investors continue to assess the extent to which they should fear that central banks are pushing the global economy into recession as they try to curb inflation by raising interest rates.

“Oil markets have remained under pressure as investors feared that US rate hikes could halt the economic recovery and dampen fuel demand,” said Kazuhiko Saito, chief analyst at Fujitomi Securities Co. Ltd.

“US and European hedge funds liquidated their positions before the end of the second quarter, which also dampens investor sentiment,” he added, predicting that the WTI could fall below $ 100 a barrel before the holidays. July 4 in the United States.

The Federal Reserve is not trying to trigger a recession to stop inflation, but is fully committed to controlling prices, even as it risks an economic slowdown, US central bank chief Jerome Powell said on Wednesday.

US President Joe Biden, meanwhile, has called on Congress to approve a three-month suspension of the federal gas tax to address record high pump prices and provide temporary relief to American families this summer.

“Reports have temporarily increased oil prices, but then it was thought that even if the gas tax were suspended, retail prices would remain high, making it more difficult to stimulate demand,” Saito of Fujitomi said.

The U.S. Energy Information Administration said its weekly oil data, due to be released on Thursday, would be postponed until next week due to systemic problems.

Elliot Frost

"Pop culture maven. Analyst. Writer. Wannabe food evangelist. Organizer. Friendly internet lover. Incurable troublemaker. Entrepreneur."

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