Oil price dips on demand concerns

Oil prices fell in volatile trading on Tuesday on demand concerns after the International Monetary Fund (IMF) reduced its economic growth forecasts and warned of higher inflation.

Brent crude was down $3.94, or 3.4 per cent, to $109.22 a barrel at 1338 GMT, having risen more than $1 to $114.21 earlier in the session.

US West Texas Intermediate crude fell $3.80, or 3.5 per cent, to $104.41 after touching $108.92.

The IMF on Tuesday cut its forecast for global economic growth by nearly a full percentage point, citing Russia's invasion of Ukraine, and warned that inflation is now a "clear and present danger" for many countries.

The bearish outlook added to price pressure from the dollar trading at a two-year high. A firmer greenback makes commodities priced in dollars more expensive for holders of other currencies, which can dampen demand.

Concerns over demand growth were already in focus after a preliminary Reuters poll on Monday showed US crude oil inventories are likely to have risen last week.