Oil prices fell significantly on Tuesday. In the evening, the price of a barrel of raw materials on the American market was less than a hundred dollars. There is growing concern in the markets that the economic slowdown will lead to a decrease in the demand for petroleum products.
The price of a barrel of West Texas Intermediate oil fell on Tuesday before 21:00 by 10.22 percent. Up to $99.28/b. According to Bloomberg data, it is trading below $100 a barrel for the first time since May.
Brent loses 9.62% on global recession fears. It comes to about $102.58/b.
Crude oil prices drop
Consulting firm Ritterbusch and Associates explains that these declines are due to concerns about “a high probability of a recession when oil demand is already weak”. However, Citi analysts predicted that Brent crude price It could drop to $65 by the end of this year if the economy enters a recession.
CNBC reports that oil prices have risen since the invasion Russia to Ukraine, which has raised fears of a global gas shortage. Russia is one of the major oil exporters, especially to Europe.
The price of West Texas Intermediate crude rose to $130.50 per barrel in March, while the price of Brent crude approached the level of $140 per barrel. These were the highest price levels since 2008. Rising commodity prices contributed significantly to the rise inflationIt is the highest in many countries for decades.
Despite the current clear declines, some experts say oil prices are likely to remain elevated.
Recession periods do not have great achievements in killing demand. Bart Mellick, head of commodity strategy at TD Securities, said Tuesday that commodity stocks are at a very low level, which could also mean that restocking will maintain strong demand for oil.
Main image source: stock struggle
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