Oil Prices Plunge as Inventories Swell Amid Oversupply Concerns

Oil prices fell Wednesday as global markets saw widespread selling, highlighting concerns about economic growth and fuel demand. The decline was made worse by a stronger dollar and reports of rising U.S. crude inventories.

Brent crude futures dropped 36 cents, or 0.56 percent, to $64.08 per barrel by 0221 GMT. U.S. West Texas Intermediate crude fell 40 cents, or 0.66 percent, to $60.16. Both benchmarks have been losing ground since Tuesday.

The oil market decline was part of a broader selloff across financial markets. Asian stock markets followed Wall Street's overnight drop as investors worried about overvalued stocks, particularly shares of artificial intelligence companies.

Here's what's driving the oil price drop: Economic growth concerns are making traders nervous about future fuel demand. When economies slow down, people drive less and businesses use less energy. That means less oil consumption.

The stronger dollar also hurts oil prices. Since oil trades in dollars globally, a stronger U.S. currency makes crude more expensive for buyers using other currencies. This typically reduces demand.

Reports of rising U.S. crude stockpiles add another layer of pressure. Higher inventories suggest either weaker demand or stronger supply - both scenarios that push prices down.

For energy investors and oil-dependent economies, this trend matters because it signals potential headwinds for the sector. Countries that rely heavily on oil exports may see reduced revenues if prices continue falling, while consumers might benefit from lower fuel costs at gas stations.

The connection between oil and broader market sentiment shows how interconnected global markets have become. When tech stocks stumble over AI valuation concerns, it can ripple through to commodity markets as investors reassess economic growth prospects.