By Arathy Somasekhar
HOUSTON (Reuters) – Oil prices fell more than $5 a barrel on Wednesday to the lowest level in more than a year as unease over Credit Suisse spooked world markets and overrode hopes for a recovery in Chinese oil demand.
The first signs of a return to market stability faded after Credit Suisse’s biggest investor said it could not provide the Swiss bank with further financial assistance, sending its shares and other European shares lower.
“It doesn’t matter what your risk asset is: Right now, people are switching off different instruments here,” said Robert Yawger, director of energy futures at Mizuho in New York.
“Nobody wants to go home with a big position on anything today… You really have nowhere to hide.”
Both oil benchmark contracts hit their lowest level since December 2021 and have fallen for three consecutive days.
Brent crude fell $3.76, or 4.9%, to settle at $73.69 a barrel. US Crude Oil (WTI) fell $3.72, or 5.2%, to $67.61, breaking technical levels of $70 and $68 and extending the sell-off.
Volatility in Brent and WTI hit their highest level in over a year and both entered technically oversold territory on Wednesday.
On Tuesday, both indexes fell more than 4%, weighed down by fears that the collapse of the Silicon Valley Bank (SVB) last week and other US bank failures could trigger a financial crisis that would weigh on demand for fuel.
(Reporting by Alex Lawler; Additional reporting by Florence Tan in Singapore and Yuka Obayashi in Tokyo)
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