Oil prices fell 6% on Wednesday as worries grow about lower demand and a slowing economy.
Reports surfaced that Russia might end its ban on diesel exports, and oil inventories rose in some areas.
"Demand destruction has begun (again)," JPMorgan analyst Natasha Kaneva warned.
US and Brent oil prices both fell as much as 6% on Wednesday, representing a sharp reversal of an uptrend that began in July.
West Texas Intermediate oil traded at $84.57 a barrel on Wednesday, about 11% below the $95 mark that was hit last week. Meanwhile, Brent crude was at $86.12 a barrel, representing a 12% decline from its high last week.
Investors have been worried about the 30% surge in oil prices over the past couple of months, as they have led to sticker shock at the gas pump, which tends to weigh down consumer sentiment and their spending habits.
Wednesday's decline in oil prices came after reports surfaced that Russia might soon lift its ban on diesel exports, though Russia and Saudi Arabia are continuing to maintain their voluntary oil production cuts that helped lift crude prices over the past few weeks.
Data from the Energy Department on Wednesday indicating weak demand for gasoline also contributed to oil's tumble.
According to JPMorgan, oil could be suffering from demand destruction as a result of the sharp rise in prices this summer, especially as the peak travel season winds down.
"Demand destruction has begun (again)," JPMorgan's Natasha Kaneva said in a Wednesday note, adding that "global oil stock draws have ended."
"Preliminary satellite stock observations from Platts suggest that during the first three weeks of September, global commercial crude inventories declined 8 million barrels, while the world's oil product stocks surged 38 million barrels, for a net build in total commercial oil liquids of 30 million barrels," Kaneva said.
An increase in stockpiles could continue to pressure oil prices in the fourth quarter, as there is expected to be a 700,000 barrel a day increase in global oil liquids production, with a third of that coming from US natural gas production.
Kaneva has a year-end price target of $86 a barrel for oil, as she expects inventories to build up heading into the winter months.
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