Oil down over demand fears ahead of Fed meeting next week

Oil prices fell on Tuesday over economic recession fears ahead of an expected interest rate hike by the US Federal Reserve, putting a hold on hopes for an imminent economic recovery.

International benchmark Brent crude traded at $87.94 per barrel at 0726GMT, a 0.28% decrease from the closing price of $88.19 a barrel in the previous trading session.

The American benchmark West Texas Intermediate (WTI) traded at $81.52 per barrel at the same time, a 0.12% loss after the previous session closed at $81.62 a barrel.

Amid comments by Fed policymakers signaling an interest rate over 5%, both benchmarks posted slight decreases over weak demand concerns in the US, the world’s largest oil-consuming country.

The market expectation is a policy rate hike by 25 basis points during Fed’s meeting on Feb. 1.

Meanwhile, hopes for a strong demand in China support upward price movements as the country expects about 2.1 billion domestic journeys to be made over a 40-day travel season that includes the weeklong Lunar New Year holidays which started on Saturday.

However, such a massive influx of people also sparks fears that the number of cases would rise again to provoke China’s strict “zero-COVID policy.”

Source: Anadolu Agency