Oil prices fall more than 2% extending losses

Oil prices added to losses from the previous session on Thursday, dropping more than 2% as investors worried that aggressive US interest rate hikes could trigger a recession and dent fuel demand.

US West Texas Intermediate (WTI) crude futures fell 2.9%, to $103 a barrel. Brent crude futures dropped 2.5% to $108 a barrel.

Both benchmarks tumbled around 3% on Wednesday to hit their lowest levels since mid-May.

oil well

An oil rig drilling a well near Midland, Texas. (REUTERS/Ernest Scheyder/Reuters Photos)

Investors remain concerned that central banks could push the world economy into recession with interest rate increases.

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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, US central bank chief Jerome Powell said on Wednesday.

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Jerome Powell

Federal Reserve Chairman Jerome Powell speaks to the Senate Banking, Housing and Urban Affairs Committee, as he presents the Monetary Policy Report to the committee on Capitol Hill, Wednesday, June 22, 2022, in Washington. (AP Photo/Manuel Balce Ceneta / AP Newsroom)

POWELL PROMISES THE FED IS ‘STRONGLY COMMITTED’ TO FIGHTING INFLATION WITH MORE RATE HIKES

President Biden has called on Congress to pass a three-month suspension of the federal gasoline tax to help combat record prices at the pump.

The average price for a gallon of gasoline slipped again on Wednesday, remaining below the $5 threshold for a fifth straight day, according to AAA.

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The price of a gallon of gasoline declined to $4,955, according to AAA. The price on Tuesday fell to $4,968.

Reuters contributed to this report.

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