Oil prices fell on Friday on recession fears and a strengthening US dollar. Supply concerns have risen after Moscow’s mobilization campaign in its war with Ukraine and a marked stalemate in revival talks of the Iran nuclear deal.
Brent crude futures fell 41 cents, or 0.5%, to $90.05 per barrel as of 0325 GMT, while West Texas Intermediate (WTI) crude futures fell 30 cents, or 0.4%, to $83.19 a barrel.
Front-month Brent and WTI contracts are down 1.5% and 2.3% respectively so far.
Crude oil prices remain volatile as energy traders grapple with a shortage of supplies and a worsening demand outlook.
In the wake of accelerating rate hikes by major central banks, the risk of a global recession overshadows supply problems in oil markets, with the recent escalation in the Russia-Ukraine war.
Crude oil in the US Strategic Petroleum Reserve fell to its lowest level since 1984 last week. The sharp decline in US SPR and stockpiles can be considered to have supported oil prices at some point as there are still inevitable undersupply problems in physical markets as Iran’s nuclear deal hits a stalemate.
After the U.S. Federal Reserve’s third-rate hike of 75 basis points on Wednesday, central banks around the world also followed suit, raising the risk of an economic slowdown.
A senior U.S. State Department official said efforts to revive the 2015 Iran nuclear deal were stalled by Tehran’s insistence on closing the UN nuclear watchdog’s investigations, dampening expectations for a revival of Iranian crude oil.
