Oil Hits Fresh 6-Month Low on Demand Concerns, Reverses Early-Trade Uptick

  • Investing.com
  • Commodities News
Oil Hits Fresh 6-Month Low on Demand Concerns, Reverses Early-Trade Uptick
Credit: © Reuters.

By Malvika Gurung

Investing.com -- After posing a brief rally in the early session, oil tumbled to hit a fresh 6-month low on Wednesday amid rising concerns of curtailing demand on prospects of a global recession. 

Fears of weaker fuel demand on a glum economic backdrop overshadowed an American Petroleum Institute (API) report on Tuesday showing lower U.S. crude and fuel stocks, supporting oil prices earlier in the session.

Further, the British CPI inflation print recording a fresh 40-year high in July did little to improve the economic outlook.

Brent crude tanked to its lowest since Feb at $91.51/barrel and WTI Futures declined to $86.33/barrel on Wednesday.

"The oil market is struggling to shake off recession fears, and there is little to suggest that this will change any time soon," stated Stephen Brennock of PVM.

Oil markets are closely awaiting developments from US-Iran talks to revive Iran's 2015 nuclear deal with world powers, which could eventually lead to a boost in Iranian oil exports, further sliding the oil prices.

Moreover, the recent high volatility in crude oil markets has led to an exodus of traders and fund managers, reducing the activity to a seven-year low amid the worst global energy crisis in decades, noted Reuters.

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