Oil falls over 4% as demand concerns persist, dollar gains

Oil drilling rigs

Oil prices declined by more than 4% today, Jan. 3, amid fears of weak global demand for crude and in conjunction with the rise of the US dollar.

Managing Director of the International Monetary Fund (IMF) Kristalina Georgieva said that the global economy is facing a difficult year, and that one-third of the world economy is expected to witness a recession, Bloomberg reported.

Chinese President Xi Jinping, during his New Year's speech on Dec. 31, said that difficult challenges in the country's battle against COVID-19 remain, with infections rising as strict restrictions are lifted.

Investors are also monitoring the developments related to the lifting of COVID-19 restrictions in China, with new cases on the rise.

Meanwhile, a survey revealed that OPEC's oil production rose by 150,000 barrels to reach 29.14 million barrels per day last December.

Brent crude futures for March delivery fell 4.4%, or $3.81, to settle at $82.10 a barrel.

WTI crude for February delivery also fell by 4.2%, or $3.33, to $76.93 a barrel.