Oil prices fell by more than five dollars a barrel at the end of trading today, Wednesday, to reach the lowest level in more than a year, as concern about the Credit Suisse financial bank caused panic in global markets and dispelled hopes for a recovery in Chinese demand for oil.
Early signs of a return to market stability faded after the largest investor in Credit Suisse said it could not provide more financial assistance to the Swiss bank, sending its and other European stocks plummeting.
Brent crude fell $3.76, or 4.9 percent, to settle at $73.69 a barrel. US West Texas Intermediate crude fell $3.72, or 5.2%, to settle at $67.61.
Both benchmarks fell more than 4 percent on Tuesday, pressured by fears that the collapse of Silicon Valley Bank last week and the failures of other US banks could lead to a financial crisis that would weigh on fuel demand.
The dollar also rose against a basket of currencies, making buying dollar-denominated oil more expensive for holders of other currencies.
Government data showed that US crude stocks rose by 1.6 million barrels last week, which exceeded analysts’ expectations in a Archyde.com poll, with an increase of 1.2 million barrels.
The monthly report of the International Energy Agency on Wednesday provided support by the expectation of an increase in Chinese demand for oil, a day after OPEC raised its forecast for Chinese demand growth for 2023.