Despite fears of rising tensions in the Middle East, the risk of recession in the U.S., the world’s largest energy consumer, contributed to the decline in oil prices, writes Reuters. According to the news agency, the slow recovery of the global economy also put pressure on prices.
Oil prices fluctuated near their lowest in eight months as fears of a U.S. recession offset concerns about how rising tensions in the Middle East would affect energy supplies, Reuters reported.
Brent crude futures were down 0.1 per cent to $76.77 a barrel, while West Texas Intermediate crude futures were at $73.39 a barrel, down 0.2 per cent.
As the news agency notes, the price rise was fuelled by ongoing fighting in the Gaza Strip and preparations by Israel and the United States to further escalate tensions after Iran and Hezbollah vowed to avenge the assassination of Hamas politburo chief Ismail Haniyeh and Hezbollah commander Fuad Shukr.
However, oil prices still fell due to fears of recession in the US, the world’s largest energy consumer, and after OPEC+ countries confirmed their decision to phase out production cuts from October. Prices were also pressurised by concerns that a slow global economic recovery would reduce fuel consumption. Thus, economic indicators around the world turned out to be weak: in July, employers in the US created fewer jobs than expected, while factories in the US, China and Europe faced low demand.