Oil climbs after plunging on recession fears and expected interest rate increases

Oil prices rose in early trading on Friday after plunging on Thursday due to mounting concerns about a global recession and an expected increase in interest rates set for next week.

Brent, the benchmark for two thirds of the world’s oil, was trading 0.41 per cent higher at $91.21 a barrel at 8.47am UAE time while West Texas Intermediate, the gauge that tracks US crude, was up 0.27 per cent at $85.33 a barrel.

Both benchmarks fell more than 3 per cent on Thursday after the US Department of Energy said plans to restock the nation’s emergency supply did not include a trigger price, which is any oil price below which the administration will start to buy crude.

The department said that transactions were not likely to happen until after the 2023 fiscal year.

Oil prices are down about 20 per cent since early June and set to post a third consecutive weekly loss, due to a strong US dollar and as markets await an interest-rate increase from the US Federal Reserve after the latest data showed headline inflation exceeded expectations.

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