Oil falls to six-month low as recession fears grow

Oil prices fell on Wednesday to their lowest level in six months, as fears of a global recession that would dampen demand overshadowed a report showing a decline in US crude and gasoline stocks.

Brent crude futures were down 44 cents, or 0.5 percent, at $91.90 a barrel by 0815 GMT. It had earlier fallen to its lowest level since February at $91.64 a barrel. West Texas Intermediate crude futures fell nine cents, or 0.1 percent, to $86.44 a barrel.

Earlier, prices got support from a report that showed a decline in US crude and fuel stocks. Sources based on figures from the American Petroleum Institute said on Tuesday that crude stocks fell by 448,000 barrels and gasoline by 4.5 million barrels.

Official inventory data from the Energy Information Administration will be released at 1430 GMT.

Oil rose in 2022 to close to an all-time high of $147 in March after the Russian invasion of Ukraine, exacerbating supply concerns. Prices have since fallen as those fears faded by the possibility of a recession.

“There are increased downside risks as a result of the growth outlook and continued uncertainty about the restrictions imposed by China to contain the outbreak of COVID-19,” said Craig Erlam of brokerage Oanda.

In the meantime, the market is closely following the talks to revive the Iranian nuclear deal signed with world powers in 2015. Reaching the agreement in this regard may lead to an increase in Iranian oil exports.