Oil prices fell sharply on Tuesday amid worries about outlook for energy demand and on a potential increase in OPEC supply.
Disappointing economic data from the U.S. and China on Monday raised worries about oil demand.
The latest ZEW survey showed that economic sentiment continued to deteriorate in the euro area and in Germany.
Oil prices were also weighed down by news about a potential deal to revive the Iran nuclear deal.
West Texas Intermediate Crude oil futures for September ended lower by $2.88 or about 3.2% at $86.53 a barrel, the lowest settlement since January.
Brent crude futures settled at $92.34 a barrel today, down $2.76 or about 2.9% from the previous close.
Iran’s positive response to a proposed nuclear deal raised the prospects of increased supply in the market. The European Union said it’s studying Iran’s response.
The world’s biggest crude producer Saudi Aramco has also indicated a potential increase in output. Saudi Aramco said that it plans to raise crude oil output to its maximum capacity of 12.3 million barrels per day by 2025 if requested by the Saudi Arabian government to meet the needs of global consumers.
Traders now look ahead to weekly crude inventory reports from the American Petroleum Institute and U.S. Energy Information Administration.