Oil prices plunged more than 5% to an eight-month low on Friday as the U.S dollar hit its highest level in more than two decades on fears that rising interest rates will send major economies into recession.
Brent futures fell $ 4.75, or 5.3%, to $ 85.71 a barrel at 1606 GMT, down about 6% for the week. US West Texas Intermediate (WTI) crude fell $ 5.19, or 6.2%, to $ 78.30 a barrel, down 8% over the week.
It was the fourth consecutive week of falls for both benchmarks, the first time since December. Both were technically oversold, with WTI on track to its lowest since January 5 and Brent for its lowest since January 13. US gasoline and diesel futures also fell more than 5%.
The US Federal Reserve raised interest rates by a whopping 75 basis points on Wednesday. Central banks around the world have followed suit with their own increases, increasing the risk of an economic slowdown. “The threat of a global recession continues to weigh on oil prices, with widespread monetary tightening in recent days fueling fears of a significant increase in growth,” said Craig Erlam, senior market analyst at the data firm and Oanda analysis.
