Oil prices fell about 6% in Friday’s trading, due to concerns that the major central banks’ raising interest rates could slow the global economy and reduce energy demand.
The dollar rose this week to its highest level since December 2002 against a basket of currencies, which also put pressure on prices and made oil more expensive for buyers who use other currencies, according to Reuters.
Brent crude futures for August delivery fell $6.69, or 5.6 percent, to $113.12 a barrel upon settlement, while US West Texas Intermediate crude for July delivery fell $8.03, or $6.83, to $109.56.
Brent crude recorded its first weekly decline in 5 weeks, by 7.3%, while US crude recorded its first decline in 8 weeks, by 9.2%.
“Crude prices fell with the dollar’s rise, Russia’s indication of the need to increase oil exports and with the growing fears of a global recession,” said Edward Moya, chief market analyst at OANDA Data and Analytics.
Global central banks are now beginning to tighten monetary policy, after they quickly eased it during the Corona pandemic to avoid a recession.
Last week, the US Federal Reserve made the largest increase in US interest rates in more than a quarter of a century.