NEW YORK: Tuesday’s tumultuous trading saw an almost 1% decline in oil prices as fears about a possible global recession were raised by economic data and as the market sought clarification on efforts to resurrect an agreement that would allow for more Iranian oil shipments.
After reaching a session high of $95.95 a barrel, Brent oil futures declined $1.41, or 1.5%, to $93.69 a barrel. After climbing to $90.65, West Texas Intermediate crude (WTI) fell $1.33, or 1.5%, to $88.08 a barrel.The contracts had a 3% decline in their prior sessions.
An EU spokesman said on Tuesday that the group is evaluating Iran’s answer to what it has dubbed its “final” approach to salvage a 2015 nuclear deal and speaking with the US.
Late on Monday, Iran replied to the plan, though neither Tehran nor the EU disclosed the specifics of the response.
According to UBS analyst Giovanni Staunovo, “it is still unknown what Iran informed the European Union last night, therefore certain tough topics may effect the result of the nuclear deal.”Prices were impacted by negative economic indicators.
Due to rising mortgage rates and the cost of building supplies, US residential construction fell to its lowest level in almost one and a half years in July, raising the possibility that the third quarter housing market may see additional contraction.
According to Phil Flynn, an economist at Price Futures Group, “oil traders responded because of fears about an economic slowdown and the fact that housing needs energy.” That took us off guard.
