Oil Prices Tumble On Recession Fears

Oil prices slumped on Thursday amid fears of a global recession. A surge in COVID-10 cases in China, the largest importer of crude in the world, also dampened hopes for an improvement in fuel demand.

Benchmark Brent crude futures fell nearly 2 percent to $82.32 a barrel, while WTI crude futures were down 2.2 percent at $77.20.

Global recession concerns continue to hamper any recovery in oil prices. The odds of a global recession are rising after a major COVID-19 outbreak in China.

Experts have expressed deep concerns that China may not be sharing data on any signs of evolving strains that could spark fresh outbreaks in countries around the world.

Several countries have announced measures in an effort to keep infections from spreading beyond China’s borders.

In response to surging infections, the United States, Italy, Japan, India and Malaysia announced this week they would increase health measures for travellers from China.

Meanwhile, China has rejected criticism of its COVID data and played down the risk of new variants, saying it expects future mutations to be potentially more transmissible but less severe.

Investors were also reacting to the latest data from the American Petroleum Institute showing that U.S. crude oil inventories fell by 1.3 million barrels in the week ended Dec. 23, which was less than expected.

The U.S. Energy Information Administration will release its official weekly figures later in the day.