Oil prices experienced a significant decline over the past week, with a 7% drop driven by concerns about weakening demand from China and uncertainty in the Middle East. China, the world’s second-largest economy, plays a crucial role in global oil demand. However, worries about its sluggish economic recovery and reduced consumption have caused a bearish sentiment in the energy markets.

Brent crude, the global benchmark, and West Texas Intermediate (WTI), the U.S. benchmark, both saw substantial price decreases. Brent crude fell to $84.58 a barrel, while WTI dropped to $82.19 per barrel. This marks a notable reversal after weeks of fluctuating prices impacted by geopolitical tensions and market speculations.

The Middle East, a significant oil-producing region, also contributed to market uncertainty. While there are ongoing concerns about supply disruptions due to geopolitical tensions, these have been somewhat offset by reports of stable production and exports from key producers, such as Saudi Arabia and Iran. Mixed signals from the region have kept the market volatile.

China's demand struggles are compounded by broader economic challenges, including weaker industrial output and a faltering real estate sector. As the country is a major oil importer, any significant slowdown in its consumption directly impacts global oil prices. This demand slump has led to growing concerns about oversupply in the market, which could further pressure prices in the coming months.

With global economic challenges, particularly in China, and the mixed outlook from the Middle East, oil prices are expected to remain volatile in the near term as market participants closely monitor these key factors.