It’s unclear, however, whether it will be a sustained price drop that will help bring down the record nightmarish prices facing gas stations across the country. Industry Brent crude futures fell $6.69 (£5.47), or 5.6%, to settle at $113.12 (£92.53) a barrel, while US crude West Texas Intermediate (WTI) fell $8.03 (£6.57), or 6.8%, to settle at $109.56 (£). 89.62).
This is the lowest close for Brent since May 20 and the lowest for WTI since May 12.
It was also the largest daily percentage decline for Brent since early May and the largest for WTI since late March.
The drop in prices is largely the result of investor fears that interest rate hikes by major central banks could slow the global economy and therefore reduce demand for energy.
Edward Moya, senior market analyst at data and analytics firm OANDA, said fears of a global recession had helped push prices lower.
He said: “Crude prices fell as the dollar rallied, Russia signaled oil exports are set to rise and as global recession fears grow.”
As a result, global central bankers and national governments that spent large sums during the pandemic are now cutting spending in an attempt to curb spiraling inflation.
The US central reserve raised interest rates to their highest level in a quarter century.
John Kilduff, a partner at Again Capital LLC in New York, pointed out that this had an inevitable impact on oil prices.
READ MORE: Putin mortified as UK ‘highly likely’ to send troops to NATO task forcee
US President Joe Biden has also blamed producers for taking advantage of exorbitant prices rather than producing production.
Mr Biden has ruled out meeting Saudi de facto leader Mohammed bin Salman during his trip to the Middle East next month.
This is despite his administration encouraging Riyadh to increase oil production to meet global demand and help lower prices.
Since the easing of Covid restrictions across much of the world in mid-2021, oil production has failed to keep up with rapidly rising demand.
This pushed prices higher even before Russia’s invasion of Ukraine pushed prices up further in February on supply concerns.