Oil falls more than 1% due to fear of recession in the US and expectations of lower demand

Los oil prices They fell this Thursday, after hitting multi-month highs in the previous session, amid fears of a recession imminent in the United States and warnings from OPEC about a drop in demand for crude oil during the summer season.

At the close of the session, oil Brent fell $1.24, or 1.42%, to $86.09 a barrel, while crude West Texas Intermediate in the United States (WTI) fell $1.10, or 1.32%, to $82.16.

Both Brent and WTI gained 2% on Wednesday, hitting their highest level in more than a month, as cooling US inflation raised hopes that the Federal Reserve stop uploading interest rates.

However, minutes from the Fed’s latest policy meeting indicated that banking sector strains could push the economy into recession, weakening demand for US oil.

The market is closely monitoring economic growth indicators, which Tamas Varga, from the PVM brokerage, described as fragile. “Inflationary pressure could be high again,” he said.

In another factor that weighed on the market, the Organization of Petroleum Exporting Countries (OPEC) noted in a monthly report the downside risks to oil demand in the summer. The report highlighted rising oil inventories and a number of challenges for global growth.

However, the price decline was limited as OPEC kept its forecast for global oil demand growth unchanged in 2023. Other economic data also supported crude.

Traders remain shocked by the decision by OPEC and its allies, known as OPEC+to continue cutting production.