Oil plummets on fears recession will dampen demand – Money Times

Petroleum
US benchmark West Texas Intermediate crude fell as much as 6.7% to $103.20 a barrel (Image: REUTERS/Lucy Nicholson)

O Petroleum plummeted for the second time in a few days on concerns that a global economic slowdown will eventually hurt demand.

O West Texas Intermediate, reference oil in USA, fell as much as 6.7% to $103.20 a barrel. Investors are worried about the impact of US interest rates.

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In a hearing at the US Congress scheduled for Wednesday, the president of Federal Reserve Jerome Powell will be asked how it will contain the inflation highest in decades. In the UK, the price surge hit a new 40-year high.

Since a peak after Russia invaded Ukraine, oil markets have faced a liquidity crisis, with futures holdings at their lowest since 2016 and prices prone to disproportionate swings.

WTI also dipped below its 100-day moving average on Wednesday for the first time since January, adding technical pressure to an already fragile market.

Despite the instability of crude, which fell 6.8% on Friday, fuel markets remain tight.

The US President, Joe Bidenwill ask Congress to pass a temporary suspension of gas taxes, according to a person familiar with the plan, after the average price at gas stations across the country hit $5 a gallon this month, up more than 50% in 2022

Crude oil is heading for its first monthly loss since November as worries about an economic slowdown overshadow the fallout from the war in Ukraine and tightening supplies.

Oil giant Exxon warned this week that oil markets could remain tight for years, while Vitol Group, the world’s largest independent oil trader, has signaled rising demand for fuel in the country. China.

At the same time, rising margins give refiners an incentive to buy every barrel of oil they can.

“Broader macro influences have been dictating the oil price direction recently,” said Warren Patterson, head of commodities strategy at ING in Singapore. “But fundamentally, the market still remains constructive. The market is expected to be tight through the end of the year, while in the short term strong refinery margins should support demand.”

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About Yadunandan Singh

Born in 1992, Yadunandan approaches the world of video games thanks to two sacred monsters like Diablo and above all Sonic, strictly in the Sega Saturn version. Ranging between consoles and PCs, he is particularly fond of platform titles and RPGs, not disdaining all other genres and moving in the constant search for the perfect balance between narration and interactivity.

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