Oil prices fall on fuel demand fears sparked by recession concerns

Oil prices fell for a second day on Monday on fears of lower fuel demand from an expected global recession sparked by rising worldwide interest rates and as a surging U.S. dollar limits the ability of non-dollar consumers to purchase crude.

Brent crude futures for November settlement slipped 54 cents, or 0.63%, to $85.61 a barrel at 0511 GMT. U.S. West Texas Intermediate (WTI) crude futures for November delivery dropped 48 cents, or 0.61%, to $78.26. Both contracts slumped around 5% on Friday to their lowest since January.

The dollar index that measures the greenback against a basket of major currencies climbed to a 20-year high on Monday.

A stronger greenback tends to curtail demand for dollar-denominated oil since buyers using other currencies must spend more to buy crude.

Central banks in numerous oil-consuming countries, including the United States, the world’s biggest crude user, have raised interest rates to fight surging inflation which has led to concerns the tightening could trigger an economic slowdown.

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