Crude prices fall 3% with recession fears in the spotlight By Reuters

©Reuters. File image of activity in the Yuzhno Russkoye oil and gas field, about 200 kilometers from the Siberian town of Novy Urengoy, Russia.

By Julia Payne

LONDON, Sept 23 (Reuters) – Crude prices fell on Friday on demand fears linked to rising interest rates and a stronger dollar, though losses were limited by Russia’s mobilization campaign and the apparent stagnation of talks on a nuclear deal with Iran.

* By 1100 GMT, futures were down $2.91, or 3.21%, at $87.56 a barrel, and futures in the United States (WTI) were down $2.94, or 3.46. %, at $80.61.

* World stocks hit their lowest level in two years, while the highest in two decades, pushing down oil.

* “Recession fears, further rate hikes and the ensuing dollar strength trump geopolitical tensions,” said Tamas Varga, an analyst at PVM Oil Associates.

* “Oil gains will be limited as long as the dollar is strong, although the upcoming referendum in eastern Ukraine could further heighten tensions between Russia and the West, especially if Ukrainian allies provide additional help for Ukraine to recover these territories,” he added.

* Russia launched a referendum on Friday to annex four occupied regions of Ukraine, something kyiv called an illegal farce that it said included threats to residents if they didn’t vote.

* After the US Federal Reserve hiked rates by 75 basis points on Wednesday, central banks around the world followed suit with hikes of their own, raising the risk of an economic slowdown.

* On the oil supply side, efforts to revive the 2015 Iran nuclear deal have stalled as Tehran insists on shutting down UN nuclear watchdog investigations, a senior State Department official said. US, which alleviates expectations of a resurgence of its crude exports.

(Additional reporting by Emily Chow in Singapore; Spanish editing by Carlos Serrano)

Leave a Comment

Your email address will not be published.