OIL COSTS DROP TO THE LOWEST LEVEL SINCE JULY Brent crude futures fell by 4%
The battle against inflation could receive a boost – if a big fall in global oil costs is sustained.
Brent crude futures fell by 4% on Tuesday to levels not seen since July on the back of data that suggested demand would continue to slide in China – the world’s second-biggest economy.
Brent was trading at $81 a barrel while US crude also slid to $77, registering declines above $3 for each.
The collapse left Brent below $84 a barrel at the US market close for the first time since prices spiked in the wake of the deadly attack on Israel by Hamas on 7 October.
The lower prices were later supported by new forecasts from the US Energy Information Administration which took a red pen to earlier predictions for petrol use in early winter.
Analysts said that the prospect of a wider conflict in the Middle East remained the main concern for the oil outlook.
A set of scenarios published by the World Bank recently warned that a serious escalation, taking in major oil-producing nations, risked a spike north of $150 a barrel.
But its base case for oil prices next year is around the current level.
Prices were first lifted at the end of June, from around the $72 level, by production cuts implemented by Saudi Arabia and Russia.