Oil extends losses as recession fears mount

Thursday,   23-Jun-2022   08:01 AM (IST)

Oil prices fell 2% in early trade on Thursday, extending losses from the previous day, as investors worried that aggressive U.S. interest rate hikes could trigger a recession and dent fuel demand. U.S. West Texas Intermediate (WTI) crude futures fell $2.39, or 2.3%, to $103.80 a barrel by 0031 GMT. Brent crude futures dropped $2.24, or 2.0%, to $109.50 a barrel. Both benchmarks tumbled around 3% on Wednesday to hit their lowest levels since mid-May. Investors are continuing to assess how worried they need to be about central banks potentially pushing the world economy into recession as they attempt to curb inflation with interest rate increases. The Federal Reserve is not trying to engineer a recession to stop inflation but is fully committed to bringing prices under control even if doing so risks an economic downturn, U.S. central bank chief Jerome Powell said on Wednesday. U.S. President Joe Biden, meanwhile, called on Congress to pass a three-month suspension of the federal gasoline tax to help combat record pump prices and provide temporary relief for American families this summer. The U.S. Energy Information Administration said its weekly oil data, which was scheduled for release on Thursday, will be delayed due to systems issues until at least next week.