Oil Hits Lowest Since January as Dollar, Demand Concerns Flare

Oil sank to the lowest since January as the dollar surged to a record and global demand concerns escalated, including in lockdown-hit China, Bloomberg reported.
West Texas Intermediate fell toward $85 a barrel as risk assets from equities to commodities slumped, with a gauge of the dollar hitting an all-time high. The currency’s ascent makes oil more expensive for buyers outside the US.
Crude has made a weak start to September, extending a run of three monthly losses that’s the worst streak in more than two years. With central banks jacking up rates to quell inflation, investors are concerned economies may tip into recession. In China, virus curbs are damping demand, with centers from Chengdu to Shenzhen extending lockdowns or adopting movement controls.
Widely-watched oil market time spreads have been volatile. Brent’s prompt spread — the difference between its nearest two contracts — was at 78 cents a barrel in a backwardation , compared with $1.34 at the start of the week.