The price of West Texas Intermediate crude fell nearly 10% on Tuesday, below $ 98 a barrel. Brent crude was down more than 10%, below $ 102 a barrel.
It’s the first time the WTI has been below $ 100 since May 11th. It was also the last time the Brent, which is normally trading slightly higher, was below $ 102 a barrel. Brent hit a low of $ 101.10 a barrel on Tuesday afternoon before recovering part of that fall. But it was still below $ 102, below Monday’s close of $ 113.50 a barrel. Brent has not been below $ 100 since April 25th.
Wholesale gas futures also fell, dropping 35 cents a gallon at noon trading, or 9% for the day.
The national average cost of a gallon of gasoline at the pump is now $ 4.80, according to the latest AAA reading, one cent below Monday and 8 cents from a week ago. Gas prices peaked at $ 5.02 a gallon on June 14th.
Growing fears about the chances of a recession are the main driver of the latest oil and gasoline futures sale, said Tom Kloza, OPIS’s global head of energy analysis.
Until relatively recently, oil and gas investors had believed that market forces could keep prices under control in the short term. “There is now a perceived downward risk linked to the risk of recession,” he said.
This story is being developed and will be updated.