04.07.2022
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Oil falls in price on fears of a recession and demand

MOSCOW, June 23 – PRIME. World oil prices continue to fall on Thursday evening, investors fear that the tightening of monetary policy by world central banks to curb inflation could affect the global economy and demand prospects, according to trading data.

The dollar rose by 32 kopecks, the euro fell by 22 kopecks

As of 19.02 Moscow time, the price of August futures for Brent crude fell by 0.68%, to $110.98 per barrel, August futures for WTI — by 0.94%, to $105.19. During the day, oil became cheaper by 1%.

One of the main factors in the markets remains the topic of raising key rates by world central banks. In June, the US Federal Reserve System (FRS) has already raised its rate by 75 basis points, to 1.5-1.75% per annum, analysts expect a similar increase in July.

The tightening of monetary policy is associated with high inflation. Markets fear that such measures could undermine the economic recovery and trigger a recession, which in turn would weigh on the outlook for oil demand.

At the same time, underlying factors continue to point to a scarce market, which does not allow oil prices to fall below $100 per barrel. “The next big test for oil bears is the $100 level. Many investors do not expect oil prices to fall below this level, noting the lack of global supplies and strong demand,” said Swissquote Bank analyst Ipek Ozkardeskaya, quoted by MarketWatch.

Source: 1prime

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