It is unclear, however, if it will be a sustained drop in prices that will help cut the record breaking nightmare prices faced at petrol stations across the country. Industry Brent futures fell $6.69 (£5.47), or 5.6 percent, to settle at $113.12(£92.53) a barrel while US West Texas Intermediate (WTI) crude fell $8.03 (£6.57), or 6.8 percent, to settle at $109.56 (£ 89.62).
This was the lowest close for Brent since May 20 and the lowest for WTI since May 12.
It was also the biggest daily percentage decline for Brent since early in May and the biggest for WTI since late March.
The fall in prices is largely the result of fears from investors that interest rate hikes by major central banks could slow the global economy and therefore reduce the demand for energy.
Edward Moya, senior market analyst at data and analytics firm OANDA said that fears of a global recession had contributed to the drop in prices.
He said: “Crude prices tumbled as the dollar rallied, Russia signaled oil exports should increase, and as global recession fears grow.”
As a result global central bankers and national governments who spent significant amounts during the pandemic are now reducing spending to attempt to curb spiraling inflation.
The US central reserve hiked interest rates to their highest level in a quarter of a century.
John Kilduff, partner at Again Capital LLC in New York pointed out this was having an inevitable impact on oil prices.
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US President Joe Biden has also blasted producers for profiting on sky high prices rather than producing output.
Mr Biden has ruled out meeting Saudi Arabia’s de facto leader Mohammed bin Salman during his trip to the Middle East next month.
This is despite the fact that his administration has encouraged Riyadh to increase oil production in order to meet worldwide demand and help reduce prices.
Since the relaxation of Covid restrictions across much of the world in mid 2021 oil production has failed to keep up with rapidly increasing demand.
This pushed prices up even before Russia’s invasion of Ukraine pushed prices up even further in February following concerns about supply.