Economic growth concerns dampen rally in oil prices

Economic growth concerns dampen rally in oil prices

Muscat: After showing swift recovery since the last week of September 2022, oil prices once again trended downwards led by concerns related to the pace of global economic growth and a possibility of a recession in parts of Europe, according to a new report.

“Crude oil future prices peaked at a five-week high level of $98.63 per barrel on October 10, 2022, after seeing consistent gains that came after Opec+ announced a larger-than-expected cut to its oil production,” the Kuwait-based Kamco invest said in its October 'Oil Market Monthly Report'.

However, prices trended downwards after the US dollar reached a fresh 24-year high on expectations of higher-than-expected rate hikes in the coming months as inflation continues to remain elevated. In addition, a downward revision to the world gross domestic product (GDP) growth rate by the IMF with a warning of increased risk of a global recession also affected the trajectory of oil prices.

Meanwhile, the rising COVID-19 risk in China once again forced the country to heighten restrictions in key Chinese cities, thereby further delaying the hopes of a crude oil demand recovery in one of the world’s largest consumers of crude oil, the report added.

On the other hand, prices of oil products