Oil Dips as Inflation Adds to Concerns Over Demand Destruction
- U.S. inflation rose last month to a fresh 40-year high
- WTI futures settled around $106, Brent dips below $110
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Oil’s tumultuous rally paused after U.S. inflation rose to a fresh 40-year high, sparking worries that surging prices could hasten the onset of demand destruction.
Futures in New York settled 2.5% lower, after trading in a $9 range on Thursday. On a day with few new developments from either OPEC+ or the war between Russia and Ukraine, broader market moves came to the forefront, with oil tracking its typical inverse relationship to the dollar. As the dollar rises, commodities priced in the currency become cheaper. On Thursday, the foreign ministers of Russia and Ukraine met in Turkey but the meeting failed to yield any results.