Brent crude oil futures yesterday slipped to $66.73 per barrel, down 30 cents, or 0.5 per cent over supply disruptions from the Organisation of Petroleum Exporting Countries (OPEC) production cutbacks and United States (U.S.) sanctions on Iran and Venezuela.
U.S. West Texas Intermediate (WTI) futures were at $58.69 per barrel, down 35 cents, or 0.6 per cent.
Both crude oil price benchmarks have slumped by almost three per cent since last week, hitting their highest since November last year.
Concerns about a potential U.S. recession emerged Friday after cautious remarks by the U.S. Federal Reserve caused 10-year treasury yields to slip below the three-month rate for the first time since 2007.
Historically, an inverted yield curve – where long-term rates fall below short-term – has signalled an upcoming recession.
Adding to concerns of a widespread global downturn, manufacturing output data from Germany, Europe’s biggest economy, shrunk for the third straight month.
“Estimates for growth and earnings have been revised down materially across all major regions,’’ said U.S. bank, Morgan Stanley.
ANZ bank said the darkening economic outlook “overshadowed the supply-side issues’’ the oil market was facing amid supply cuts, led by producer club OPEC as well as the U.S. sanctions on Venezuela and Iran.