Crude oil prices declined sharply and closed lower for the first time in four sessions, as concerns about outlook for energy demand weighed on the commodity.
West Texas Intermediate crude oil futures for May ended down $1.89, or about 7.7%, at $22.60 a barrel.
On Wednesday, WTI Crude oil futures ended up $0.48, or 2%, at $24.49 a barrel, after having gained 2.8% and 3.2% in the previous two sessions.
According to reports, the International Energy Agency’s executive director Fatih Birol said during an online event hosted by the Atlantic Council today that global oil demand will likely fall by about 20 million barrels a day, due to widespread lockdown across the globe.
Also, the failure of OPEC and its allies to come to an agreement with regard to production cuts could result in oversupply in the oil market.
Further, reports that U.S. Department of Energy is suspending its plans to buy crude for the country’s Strategic Petroleum Reserve hurt oil prices. The energy department has reportedly taken this move as the requested $3 billion in funding for the project was left out of the $2 trillion stimulus package.