# Oil prices edge down, recession fears back in focus
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-09-23
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Oil prices fall on recession fears and supply concerns
Meta Description: Discover the impact of recession fears and supply concerns on oil prices, as global economic uncertainty puts pressure on market stability.
URL: https://financedigest.com/oil-prices-edge-down-recession-fears-back-in-focushtml

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By Emily Chow

SINGAPORE (Reuters) – Oil prices fell on Friday amid recession fears and a stronger U.S. dollar, though losses were capped by [supply concerns](https://www.financedigest.com/oil-gains-as-russian-supply-cuts-temper-concerns-over-rate-hikes-high-stocks.html "Oil gains as Russian supply cuts temper concerns over rate hikes, high stocks") after Moscow’s new mobilisation campaign in its war with Ukraine and an apparent deadlock in talks on reviving the Iran nuclear deal.

Brent crude futures fell 46 cents, or 0.5%, to $90.00 per barrel at 0630 GMT, while U.S. West Texas Intermediate (WTI) crude futures were also down 46 cents, or 0.55%, to $83.03.

Front-month Brent and WTI contracts were down 1.4% and 2.4%, respectively, for the week so far.

In the wake of accelerating rate hikes by the major central banks, the risk of a global economic recession overshadows [supply issues](https://www.financedigest.com/uks-j-d-wetherspoon-returns-to-profit-as-supply-issues-ease.html "UK’s J D Wetherspoon returns to profit as supply issues ease") in the oil markets, despite the recent escalation in the Russia-Ukraine war,” said CMC Markets analyst Tina Teng.

“However, a sharp fall in the U.S. SPR and drawdown in inventories may still keep [oil prices](https://www.financedigest.com/oil-ticks-up-as-u-s-inflation-cools-but-prices-set-for-monthly-drop.html "Oil ticks up as U.S. inflation cools, but prices set for monthly drop") supported at some point as there is still an inevitable undersupply issues in the physical markets, while Iran’s nuclear deal is in stalemate,” she said, referring to crude oil in the U.S. Strategic Petroleum Reserve which dropped last week to its [lowest since](https://www.financedigest.com/uk-unemployment-hits-lowest-since-1974-but-jobs-boom-is-fading.html "UK unemployment hits lowest since 1974 but jobs boom is fading") 1984.

Following the U.S. Federal Reserve’s hefty 75-basis-point increase on Wednesday for a third time, central [banks around the world also followed suit in hiking](https://www.financedigest.com/asian-shares-gain-as-fears-about-rapid-fed-hikes-bank-crisis-fade.html "Asian shares gain as fears about rapid Fed hikes, bank crisis fade") interest rates, raising the risk of economic slowdowns.

Crude [prices remain volatile as energy traders grapple with a deteriorating demand outlook](https://www.financedigest.com/oil-prices-rebound-after-opec-upgrades-china-demand-outlook.html "Oil prices rebound after OPEC upgrades China demand outlook") that is still vulnerable to shortages,” said Edward Moya, senior market analysts at OANDA, in a note.

[“Supply risks and tight](https://www.financedigest.com/ceraweek-europe-gas-supplies-to-stay-tight-2-more-winters-equinor-ceo-says.html "CERAWEEK-Europe gas supplies to stay tight 2 more winters, Equinor CEO says") market conditions should give oil some support above the $80 level, but a quicker tumble to a global recession will keep prices heavy.

A senior U.S. State Department [official said that efforts to revive the 2015 Iran nuclear](https://www.financedigest.com/australias-nuclear-submarine-plan-to-cost-up-to-245-billion-by-2055-defence-official.html "Australia’s nuclear submarine plan to cost up to 5 billion by 2055 -defence official") deal have stalled due to Tehran’s insistence on the closure of the U.N. [nuclear watchdog’s](https://www.financedigest.com/uks-competition-watchdog-to-examine-edf-buying-ges-nuclear-turbine-unit.html "UK’s competition watchdog to examine EDF buying GE’s nuclear turbine unit") investigations, easing expectations of a resurgence of Iranian crude oil.

(Reporting by Laila Kearney in New York and Emily Chow in Singapore; Editing by Leslie Adler, Kim Coghill and Ana Nicolaci da Costa)


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