© Reuters. A drone view of Transneft’s oil tanks at a crude oil terminal near the port city of Nakhodka, Russia on June 13, 2022. Photo
October 12 (Reuters) – Oil prices fell for a third consecutive session on Wednesday as investors rallied and prepared to receive US inflation data amid fuel demand concerns raised by the risks of a global recession and the tightening of COVID-19 restrictions in China.
At 04:10 GMT, crude oil futures fell 46 cents, or 0.5%, to $ 93.83 a barrel. The price of US West Texas Intermediate crude oil futures fell 54 cents, or 0.6 percent, to $ 88.81 a barrel.
Both benchmarks dropped 2% in the previous session.
The dollar rose to a 24-year high against the yen on Wednesday amid fears of inflation. A strong dollar makes dollar-denominated commodities more expensive for holders of other currencies and tends to affect oil and other riskier assets.
“Despite the fundamentals of rising oil prices and a massive cut in OPEC production, any collapse in high-risk assets could continue to hurt oil prices,” said Stephen Innes of SBI Asset Management.
The US Consumer Price Report is expected on Thursday.
The International Monetary Fund lowered its global growth forecast for 2023 on Tuesday and warned of increased risk of recession.
But the International Monetary Fund has also urged central banks to continue their fight against inflation, even as investors fear that monetary policymakers could cause a severe economic downturn by increasing funding costs.
The oil market is also under pressure from tightening COVID-19 restrictions in China, the world’s second largest consumer of oil.
Major Chinese cities, including Shanghai and Shenzhen, have stepped up COVID-19 tests and tightened restrictions after infections hit their highest levels since August.
As for supply, a preliminary survey conducted by Reuters on Tuesday showed that US stocks rose about 1.8 million barrels in the week ending October 7, after falling in the past two weeks.
Inventory data was delayed by one day this week due to Monday’s holidays.
(Prepared by Ahmed Maher for the Arabic Bulletin)
