CRUDE OIL PRICES FALL ON RISE IN COVID-19 INFECTIONS IN CHINA AND FEARS OVER RECESSION

Crude oil prices declined by over 1 percent on October 11 representing an extension of about 2 percent losses in the past session. This came as people are worried about the impact of the recession as well as the rise in coronavirus infections in China on international demand.

On October 10, both IMF Managing Director Kristalina Georgievav and World Bank President David Malpass talked about a growing risk of recession across the world and the persistent inflation threatening the worlds economy.

Around 10:16am (GMT), U.S. West Texas Intermediate crude per barrel was valued at $88.72, representing a 2.59 percent decline. At the same time, Brent crude per barrel was valued at $93.99, representing a 2.29 percent dip.

Fears over the economy have led to a sharp drop in oil prices and pessimism is growing across the markets. China is the largest importer of crude oil, and the impact of the rise in COVID-19 infections which has prompted restrictions, could affect demand.

The USD also regained strength as investors became worried over increasing interest rates and the conflict between Russia and Ukraine, thereby putting pressure on oil prices. The USDs strength leads to a rise in oil prices, especially for those buying with other currencies and also influences risk appetite.