Oil declines on lower global demand expectations, Brent below $93

Oil drilling rigs

Oil continued its downward trend for the third day in a row, closing lower today, Oct. 12, after the monthly OPEC report and amid an assessment of the risks surrounding the global economy.

The Organization of the Petroleum Exporting Countries (OPEC) lowered its forecast for global oil demand growth this year by 460,000 barrels per day (bpd) to 2.64 million bpd. It also lowered estimates of demand growth next year by 360 thousand barrels at 2.34 million bpd.

On the other hand, the US Energy Information Administration lowered its forecast on Brent crude in the current and the next two years to $102.09 and $94.58 per barrel, respectively, which represents a decline of 2% and 2.4% compared to previous estimates.

Oil prices have fallen in the past two days on fears of a global economic recession, with the International Monetary Fund slashing its forecast for economic growth next year, warning that the worst is yet to come.

Brent crude fell 1.9%, or $1.84, to settle at $92.45 a barrel. WTI crude declined 2.3%, or $2.08, to $87.27 a barrel.