Oil prices accelerated their decline on Tuesday, falling more than 5% after the International Monetary Fund (IMF) downgraded the outlook for global growth considerably, raising fears of a drop in demand for black gold.
Around 3:35 p.m. GMT (5:35 p.m. in Paris), a barrel of Brent from the North Sea for delivery in June lost 5.13% to 107.35 dollars, falling back below 110 dollars.
Read alsoHow Poland wants to do without Russian oil and gas
A barrel of US West Texas Intermediate (WTI) for delivery in May plunged 5.29% to 102.49 dollars.
"
Crude oil is down today as recession fears resurfaced with the IMF's global growth outlook downgraded by nearly a full percentage point
," said Ipek Ozkardeskaya, an analyst for Swissquote Bank. interviewed by AFP.
The IMF on Tuesday sharply lowered its global growth forecast for 2022 due to the "
seismic waves
" caused by the war in Ukraine.
Growth should thus amount to 3.6% this year, a drop of 0.8 percentage point compared to its January projections.
Read alsoWar in Ukraine: IMF lowers its global growth forecast for 2022 to 3.6%
Demand falters in China
“
Thus, the decline we see today is mainly a reflection of weaker demand prospects due to concerns about the global slowdown
,” continues Ipek Ozkardeskaya.
Demand had already “
slowed down somewhat lately
”, particularly in China, notes Carsten Fritsch, analyst for Commerzbank.
"
The restrictions linked to the coronavirus put in place by the authorities have probably played their part
", he underlines, the 25 million inhabitants of Shanghai, the economic capital of China, being confined since the beginning of the month due to the Covid-19 epidemic.
Read alsoCovid-19 toll rises in Shanghai with 10 dead
But according to Stephen Innes, an analyst at Spi Asset Management, the price of black gold is torn “
between the deficits in global supply and the drop in Chinese demand
”.
"
The decline is likely to remain limited as supply-side concerns loom
", between "
OPEC's (Organization of Petroleum Exporting Countries) reluctance to pump more oil, escalation (of war) in Ukraine, the unrest in Libya and the attacks by the Houthi rebels in Saudi Arabia
”, lists Ipek Ozkardeskaya.
