oil prices fell nearly 6 wednesday in their biggest oneday drop in more than eight months as wall street continues to stumble following the sudden collapse of silicon valley bank and signature bank and as credit suisse’s stocks plunge to a record low west texas intermediate a us benchmark for crude oil fell nearly 6 to 6748 per barrel—its lowest since december 2021 and the biggest oneday drop since july 12 international benchmark brent crude also dropped to its lowest point since december 2021 falling nearly 5 to a low of 7146 per barrel the drop comes amid fears about the banking system following the failure of two us regional banks last week and as bigger banks experience a decline in market value including swiss banking giant credit suisse whose shares were halted wednesday morning edward moya a senior market analyst with the americas oanda said the oil market will be “stuck in a surplus for most of the first half of the year” as “contagion” risks stemming from the turmoil in the banking system linger what to watch for moya believes the oil surplus will likely end if the federal reserve stops hiking interest rates to curb inflation and that oil companies “have a good chance of still keeping profitable outlooks given how quickly the oil market could swing back” the fed committee responsible for monetary policy is set to meet next week and while chair jerome powell suggested last week the central bank could opt for a largerthanexpected rate hike goldman sachs analysts think the fed might not increase rates this month due to “recent stress in the banking system” oil prices surged to nearrecord levels in february following sanctions on moscow in response to russia’s invasion of ukraine as inflation—led by gas prices—climbed last summer and as economists warned of a looming recession oil prices started to tank hitting an eightmonth low after a fourweek drop in september prices surged again in december to 8764 after european union member states agreed to a 60 perbarrel price cap on oil exports from russia—the third biggest oil producer in the world goldman sachs strategists predicted at the time brent prices will average 110 per barrel in 2023 while bank of america predicted a rise to 100—brent prices have not topped 85 so far this year bans and price caps on russian oil caused its oil export revenues to fall by 27 billion from last january to 116 billion last month the international energy agency announced wednesday stating it “remains to be seen if there will be sufficient appetite for russian oil products” russia has also signaled cuts to its oil production as its invasion of ukraine enters its 13th month what we don’t know whether the drop in oil prices will correspond to a significant decrease in what drivers pay at the pump in a statement last week aaa spokesperson andrew gross said cheaper oil prices along with a drop in gas consumption during the winter months “usually combine to lower pump prices” though he clarified a switch to summer gasoline blends which are more fuel efficient but cost more to produce could cause gas prices to jump roughly 5 to 10 cents per gallon according to aaa the price of oil accounts for approximately 56 of the price of gas at the pump which currently stands at 344 on average oil tumbles 7 heads for worst day in six months as banking crisis routs markets cnbc oil surges as russian oil price cap kicks in—here’s how high experts predict it could go forbes