Oil prices drop 2% on recession concerns, heading for weekly fall

Oil prices fell almost 2 per cent on Friday and were on track for a weekly decline as interest rate hikes from major central banks fuelled worries about a sharp economic slowdown. Brent crude was down $2.19, or 1.8 per cent, at $117.62 a barrel at 1334 GMT (7.04 pm IST), and US West Texas Intermediate crude fell $2.56, or 2.2  per cent, to $115.03.
 
Brent was on track for its first weekly dip in five weeks, and US crude for its first decline in eight weeks, in line with a fall in equity markets amid fears of a possible recession as several central banks delivered big rate hikes.

 
The US government said while it is pursuing diplomacy to revive a nuclear deal with Iran, it will continue to use sanctions to limit exports of oil from Iran. Analysts estimate that a deal and the lifting of sanctions on Iran’s energy sector could add up to 1 million barrels of oil per day to global markets.