Oil prices touched a nine-month low on Monday as the US dollar strengthened and amid concerns of the impact of a potential recession on global demand.
The dollar lost some of its strength earlier in the day, helping both benchmarks recouping the intraday losses in the afternoon, before they fell again in the evening.
Brent, the benchmark for two thirds of the world's oil, was trading 1.88 per cent lower at $84.53 a barrel at 8.55pm UAE time. West Texas Intermediate, the gauge that tracks US crude, was down 1.92 per cent at $77.23 a barrel.
Oil fell sharply on Friday, hitting an eight-month low as concerns about a possible recession continued to trouble investors amid a strong dollar and monetary tightening by central banks globally to rein in inflation.
“US crude oil plunged below $80 per barrel on the back of rising recession worries as the European continent seems to be going into a coma before winter,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
Brent’s slide in early trade on Monday involved prices falling below $85 a barrel. The benchmark hit the lowest intraday level since January. It fell by almost 6 per cent last week in a fourth straight weekly drop, the longest losing run this year.
Crude is on its way to a substantial quarterly slump, analysts say, as leading central banks, including the US Federal Reserve, raise interest rates aggressively to fight inflation. This is hurting the outlook for energy demand and sapping investors’ appetite for risk.
“Markets had already been battered by a week full of hawkish central bank activity, highlighted by the 75 basis points hike from the Federal Reserve, but the week ended with intense volatility that seemed to be sparked by the release of a budget from the new Truss government in the UK,” Emirates NBD said on Monday.
Last Wednesday, the Fed raised its key interest rate by 75 bps, its third consecutive three quarters of a percentage point increase. This hinted at further increases to tame surging inflation. The Bank of England also raised its base interest rate by 0.5 percentage points to 2.25 per cent on Thursday, vowing to “respond forcefully, as necessary” to soaring inflation.
The Fed’s tightening has helped to drive the US dollar to a record, making commodities priced in the currency more expensive for overseas buyers.
“Oil demand will be at risk in a pending global recession, though the scale of decline is unlikely to be anywhere similar to what markets endured in 2020,” Emirates NBD said. “Nevertheless, sentiment is moving sharply and is more negative at the moment, so a further downside may be in store for oil in the near term.”
Market is also waiting to see what the Opec+ group of oil producers, led by Saudi Arabia and Russia, will do when they meet on October 5. The super group agreed cut output modestly at their previous meeting earlier this month.
The slump in prices may prompt crude oil exporter group Opec and its allies to consider intervening to stem the slide. However, analysts believe the current conditions make such market interventions unlikely and ineffective.
“Of course, Opec can do nothing about the cheaper oil, as what’s driving the market south is the worry of a bad recession looming,” Ms Ozkardeskaya said.
The threat of a looming recession is weighing heavily on both oil demand outlook and price. The global economy is expected to slow down this year because of higher inflation, the continuing conflict in Ukraine, and Covid-19 pandemic-related restrictions in China.
In July, the International Monetary Fund lowered its growth forecast for the global economy to 3.2 per cent this year, from its previous projection of 3.6 per cent in April.
The World Bank has also slashed its 2022 growth forecast for the global economy — for the second time this year — to 2.9 per cent from 3.2 per cent. The Institute of International Finance lowered its estimate to 2.3 per cent.
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
PROFILE OF HALAN
Started: November 2017
Founders: Mounir Nakhla, Ahmed Mohsen and Mohamed Aboulnaga
Based: Cairo, Egypt
Sector: transport and logistics
Size: 150 employees
Investment: approximately $8 million
Investors include: Singapore’s Battery Road Digital Holdings, Egypt’s Algebra Ventures, Uber co-founder and former CTO Oscar Salazar
Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
The National Archives, Abu Dhabi
Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.
Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en
Sleep Well Beast
The National
4AD
Results
Stage 7:
1. Caleb Ewan (AUS) Lotto Soudal - 3:18:29
2. Sam Bennett (IRL) Deceuninck-QuickStep - same time
3. Phil Bauhaus (GER) Bahrain Victorious
4. Michael Morkov (DEN) Deceuninck-QuickStep
5. Cees Bol (NED) Team DSM
General Classification:
1. Tadej Pogacar (SLO) UAE Team Emirates - 24:00:28
2. Adam Yates (GBR) Ineos Grenadiers - 0:00:35
3. Joao Almeida (POR) Deceuninck-QuickStep - 0:01:02
4. Chris Harper (AUS) Jumbo-Visma - 0:01:42
5. Neilson Powless (USA) EF Education-Nippo - 0:01:45
Student Of The Year 2
Director: Punit Malhotra
Stars: Tiger Shroff, Tara Sutaria, Ananya Pandey, Aditya Seal
1.5 stars
The years Ramadan fell in May
Usain Bolt's World Championships record
2007 Osaka
200m Silver
4x100m relay Silver
2009 Berlin
100m Gold
200m Gold
4x100m relay Gold
2011 Daegu
100m Disqualified in final for false start
200m Gold
4x100m relay Gold
2013 Moscow
100m Gold
200m Gold
4x100m relay Gold
2015 Beijing
100m Gold
200m Gold
4x100m relay Gold
How to report a beggar
Abu Dhabi – Call 999 or 8002626 (Aman Service)
Dubai – Call 800243
Sharjah – Call 065632222
Ras Al Khaimah - Call 072053372
Ajman – Call 067401616
Umm Al Quwain – Call 999
Fujairah - Call 092051100 or 092224411
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
Who has been sanctioned?
Daniella Weiss and Nachala
Described as 'the grandmother of the settler movement', she has encouraged the expansion of settlements for decades. The 79 year old leads radical settler movement Nachala, whose aim is for Israel to annex Gaza and the occupied West Bank, where it helps settlers built outposts.
Harel Libi & Libi Construction and Infrastructure
Libi has been involved in threatening and perpetuating acts of aggression and violence against Palestinians. His firm has provided logistical and financial support for the establishment of illegal outposts.
Zohar Sabah
Runs a settler outpost named Zohar’s Farm and has previously faced charges of violence against Palestinians. He was indicted by Israel’s State Attorney’s Office in September for allegedly participating in a violent attack against Palestinians and activists in the West Bank village of Muarrajat.
Coco’s Farm and Neria’s Farm
These are illegal outposts in the West Bank, which are at the vanguard of the settler movement. According to the UK, they are associated with people who have been involved in enabling, inciting, promoting or providing support for activities that amount to “serious abuse”.
SPECS
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%202-litre%204-cylinder%20turbo%20and%203.6-litre%20V6%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ESeven-speed%20automatic%0D%3Cbr%3E%3Cstrong%3EPower%3A%3C%2Fstrong%3E%20235hp%20and%20310hp%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E258Nm%20and%20271Nm%0D%3Cbr%3E%3Cstrong%3EPrice%3A%3C%2Fstrong%3E%20From%20Dh185%2C100%0D%3Cbr%3E%3C%2Fp%3E%0A
Henrik Stenson's finishes at Abu Dhabi HSBC Championship:
2006 - 2
2007 - 8
2008 - 2
2009 - MC
2010 - 21
2011 - 42
2012 - MC
2013 - 23
2014 - MC
2015 - MC
2016 - 3
2017 - 8
Company Profile
Name: Thndr
Started: 2019
Co-founders: Ahmad Hammouda and Seif Amr
Sector: FinTech
Headquarters: Egypt
UAE base: Hub71, Abu Dhabi
Current number of staff: More than 150
Funds raised: $22 million
The%20specs
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%206.4-litre%20V8%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3E8-speed%20auto%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E470bhp%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E637Nm%0D%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EDh375%2C900%20(estimate)%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%3C%2Fstrong%3E%20now%3C%2Fp%3E%0A
David Haye record
Total fights: 32
Wins: 28
Wins by KO: 26
Losses: 4
