Oil held near a three-month low after plunging almost 7% over the previous two sessions on signs the demand outlook is deteriorating.

Global benchmark Brent edged up to near $80 a barrel after closing below the threshold on Wednesday for the first time since July. West Texas Intermediate was near $76. Stocks in Asia advanced after US equities rose for an eighth day on Wednesday, their hottest winning streak in almost two years, on optimism that US interest rates have peaked.

Oil prices have tumbled sharply over the last three weeks amid growing concerns over weaker demand. The focus has returned to fundamentals, with refining margins falling and stockpiles swelling in China, the biggest importer. Asia’s largest economy returned to deflation, according to data released Thursday.

Supply from the Middle East — the source of about a third of the world’s crude — has been unaffected more than a month after Hamas attacked Israel. Russian shipments are running near a four-month high. In the US, industry data showed crude stockpiles increased by almost 12 million barrels last week, although official data from the Energy Information Administration won’t be released until next Wednesday.

Demand concerns are currently underpinning market sentiment, said Charu Chanana, a market strategist at Saxo Capital Markets Pte. “Macro data both out of the US and China, as well as the EIA inventory data, will be key in the near term to assess the impact of high interest rates on oil demand.”

The growing bearishness has been reflected in Brent’s prompt spread, where the premium for near-term contracts has nearly evaporated. The spread was 15 cents in the bullish backwardation structure, compared with $1.65 a month ago.

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