Oil prices drop as demand worries dominate

By Trend

Oil prices fell on Wednesday as demand worries returned to the
market, Trend reports citing Xinhua.

The West Texas Intermediate for August delivery lost 3.33 U.S.
dollars, or 3 percent, to settle at 106.19 dollars a barrel on the
New York Mercantile Exchange. Brent crude for August delivery
decreased 2.91 dollars, or 2.5 percent, to close at 111.74 dollars
a barrel on the London ICE Futures Exchange.

The pullback came as traders grew concerned that the central
banks’ aggressive steps to combat inflation would slow growth and
hurt demand for fuel.

In his testimony to U.S. Congress on Wednesday, Federal Reserve
Chair Jerome Powell said that the central bank is trying to bring
inflation down without inflicting too much damage, but the Fed’s
aggressive rate hikes could tip the U.S. economy into
recession.

Oil participants also waited for data on U.S. fuel inventory as
the Energy Information Administration is set to release its weekly
petroleum status report on Thursday. Analysts surveyed by S&P
Global Commodity Insights forecast the U.S. crude inventories to
show a fall of 3.7 million barrels for the week ending June 17.

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