Oil slumps over 6% as Biden set to cut fuel costs for drivers | Reuters

Oil slumps over 6% as Biden set to cut fuel costs for drivers | Reuters

Oil prices tumbled on Wednesday on news of a plan by U.S. President Joe Biden to cut fuel costs for drivers and amid concerns over a potential economic recession after recent central bank rate hikes, which also weighed on equities.

Brent crude futures were down $7.49, or 6.5%, by 1313 GMT at $107.16 a barrel, their biggest fall in percentage terms in three months. U.S. West Texas Intermediate (WTI) futures fell $7.74, or 7.1%, to $101.78, its biggest daily drop in percentage terms since March 9.

Both contracts hit their lowest since May 19 and 11, respectively.

Oil prices often move in tandem with stocks, which also took a hit as investors assessed how interest rate hikes designed to cool soaring inflation might stall an economic recovery as pandemic restrictions have eased. read more

Biden on Wednesday is expected to ask Congress to consider a three-month suspension of the 18.4 cents per gallon federal tax on gasoline and call on states to suspend their fuel taxes, a senior administration official said. read more