Oil prices are falling, reaching pre-war levels

A barrel of Brent North Sea crude oil was sold for only 89.4 dollars (CZK 2,220) around 16:00 CEST, which is an intraday drop of almost four percent. Brent was last traded at a lower value on February 2. In addition, for the first time since February 8, the price fell below 90 dollars per barrel.

The American West Texas Intermediate (WTI) light oil saw a similar decline, specifically by 3.9 percent to 83.5 dollars (2070 CZK) per barrel. It thus reached its lowest level since January 24.

“The specter of a recession dampening demand across the Western world is nearing reality as soaring inflation and rising interest rates erode consumption,” said PVM analyst Stephen Brennock.

G7 finance ministers agreed to cap Russian oil prices

Economy

According to the rating agency Fitch, the probability of a recession in the eurozone has been increased by the stoppage of gas supplies via the Nord Stream 1 gas pipeline. At the monetary meeting of the European Central Bank on Thursday, analysts expect a significant increase in interest rates. The American central bank (Fed) will probably decide to take the same step on September 21, which should raise rates by 0.75 percentage points.

However, weak economic data from China, where a strict policy in connection with the spread of the coronavirus continues to apply, also contributes to concerns about lower demand, and thus the fall in the price of oil. The country’s oil imports fell by 9.4 percent year-on-year in August, data from the customs administration showed on Wednesday.

The article is in Czech

Tags: Oil prices falling reaching prewar levels

NEXT They closed the well-known inn. We survived Covid, not the crisis anymore, the innkeeper confided