A larger sell-off in global markets was sparked by worries about the economic future, and U.S. crude stockpiles rising indicated declining demand, causing oil prices to drop by more than 2% on Thursday.

Brent crude dipped by 2.2%, to $88.13 per barrel meanwhile US West Texas Intermediate crude futures dipped by 2.7% to $83.13 per barrel.

On Wednesday, the benchmark oil contract ended the day about 2% higher. After the Wall Street Journal revealed that Israel had decided to postpone an anticipated assault of Gaza until American air defense systems could be placed in the area, it withdrew.

In recent weeks, worries about a spillover in the conflict that might involve Iran and its allies in the region have helped oil prices, but investors are also staying away from riskier assets due to anxiety.

As U.S. Treasury yields returned to 5% on Thursday, global stock prices fell to levels not seen in several months.

In addition, third-quarter economic growth in the United States was the strongest in almost two years, which increased hopes that the Federal Reserve would maintain high interest rates for an extended period of time.

Following a surprising decline in euro zone business activity figures this month, macroeconomic worries clouded the picture for oil demand.

The European Central Bank ended an extraordinary ten-year sequence of rate hikes on Thursday by keeping interest rates stable as anticipated. The bank also kept its guidance intact, indicating that steady policy will likely be followed going forward.