Oil dips on demand concerns after IMF cuts growth outlook
US West Texas Intermediate crude fell $3.80, or 3.5%, to $104.41 after touching $108.92
Oil prices fell in volatile trading on Tuesday on demand concerns after the International Monetary Fund (IMF) reduced its economic growth forecasts and warned of higher inflation.
Brent crude was down $3.94, or 3.4%, to $109.22 a barrel at 1338 GMT, having risen more than $1 to $114.21 earlier in the session.
US West Texas Intermediate crude fell $3.80, or 3.5%, to $104.41 after touching $108.92.
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The IMF on Tuesday cut its forecast for global economic growth by nearly a full percentage point, citing Russia's invasion of Ukraine, and warned that inflation is now a "clear and present danger" for many countries.
The bearish outlook added to price pressure from the dollar trading at a two-year high. A firmer greenback makes commodities priced in dollars more expensive for holders of other currencies, which can dampen demand.
Concerns over demand growth were already in focus after a preliminary Reuters poll on Monday showed US crude oil inventories are likely to have risen last week.
China's economy slowed in March, worsening an outlook already weakened by COVID-19 curbs and the conflict in Ukraine.
However, fuel demand in China, the world's largest oil importer, could begin to pick up as manufacturing plants prepare to reopen in Shanghai.
The price decline on Tuesday followed a rise of more than 1% on Monday, when oil prices hit their highest since 28 March on Libyan oil supply disruptions.
The country's National Oil Corp (NOC) warned on Monday of "a painful wave of closures" and declared force majeure on some output and exports as forces in the east expanded their blockade of the sector over a political standoff.
NOC on Tuesday declared force majeure at the Brega oil port.
Highlighting supply worries, the OPEC+ supply gap widened in March as sanctions hit Russian output.
The possibility of a European Union ban on Russian oil over its invasion of Ukraine continued to keep the market on edge. French Finance Minister Bruno Le Maire on Tuesday said that an embargo on Russian oil at a European Union level was in the works.
