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Oil prices hit 8-month low on strong dollar and recession fears

Oil prices plunged Friday to levels not seen since January, with the dollar index hitting its highest level in more than two decades and fears over demand as interest rates rise. risks pushing major economies into recession.

Brent crude futures were down more than 5% to about $88.50 a barrel around 11:45 am ET.

US-traded crude (WTI) was down more than 6% at $78.24 a barrel.

This put the two benchmark markets in technically oversold territory.

WTI was on track to have its lowest close since Jan 10, and Brent its lowest since Jan 13.

For the week, WTI was down 7%, while Brent was down 6%, the fourth straight weekly decline for the first time since December.

US gasoline and diesel futures were also down more than 5%.

“The oil market is under strong selling pressure as the US dollar maintains a strong bullish trajectory amid a further reduction in risk appetite,” said analysts at energy consultancy Ritterbusch and Associates.

The US dollar was on track for its biggest close against a basket of other currencies since May 2002.

A strong dollar reduces demand for oil making the fuel more expensive for buyers who use other currencies.

Source: CNN Brasil

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