WTI crude futures bounced back above $100 per barrel on Wednesday after dropping more than 8% to close below the key level in the previous session, as mounting fears that a recession will hurt demand were balanced by persistent supply concerns. Analysts also attributed Wednesday’s bounce on short-covering and bargain hunting. Highlighting supply tightness, OPEC Secretary General Mohammad Barkindo said Tuesday the oil industry was “under siege” due to years of underinvestment, and added that shortages could be eased if extra supplies from Iran and Venezuela were allowed. Meanwhile, oil prices have been declining since mid-June as concerns about a potential recession rattled financial markets. Citibank said oil prices could tumble to $65 a barrel by the end of year if an ”increasingly likely” recession hits the global economy.
