New York March 15 2023: Oil prices dropped about 5% on Tuesday after a U.S. inflation report and the recent U.S. bank failures sparked fears of a fresh financial crisis that could reduce future oil demand.
Brent futures fell $3.78 or 4.68%, to $76.99 a barrel by 2:14 p.m. EDT (1814 GMT), while U.S. West Texas Intermediate (WTI) crude fell $3.9, or 5.21, to $70.9.
That pushed both contracts into technically oversold territory for the first time in weeks.
Shockwaves from Silicon Valley Bank’s collapse triggered big moves in bank shares as investors fretted over the financial health of some lenders, in spite of assurances from U.S. President Joe Biden and other global policymakers.
“Crude prices are falling after a mostly in-line inflation report sealed the deal for at least one more Fed (U.S. Federal Reserve) rate hike,” said Edward Moya, senior market analyst at data and analytics firm OANDA.
