Oil prices down over growing global demand worries

Oil prices down over growing global demand worries

Tight supply concerns keep oil prices trading close to their highest levels of year

By Firdevs Yuksel

ANKARA (AA) - Oil prices decreased on Wednesday as investors weighed expectations of further US interest rate hikes and the prospect of softer Chinese demand against potential supply tightness.

International benchmark Brent crude traded at $83.70 per barrel at 10.20 a.m. local time (0720 GMT), a 0.39% fall from the closing price on Tuesday of $84.03 per barrel.

The American benchmark West Texas Intermediate (WTI) traded at the same time at $79.36 per barrel, down 0.35% from the previous session's close of $79.64 per barrel.

Demand worries triggered by fears of a slowdown in economic growth in China and expectations of further interest rate hikes in the US underpinned the decline in oil prices.

While markets await more signals from the US Federal Reserve's (Fed) monetary policy, investors fear that higher US rates could potentially hurt oil demand in the world's largest oil consumer.

However, despite tight global supply concerns after output curbs from OPEC+ countries, Saudi Arabia and Russia are still keeping oil prices trading close to their highest levels of this year.

Meanwhile, the American Petroleum Institute's expectations of crude oil inventories released late Tuesday showed a fall of about 2.42 million barrels last week, signaling a rise in demand in the world's largest oil consumer.

The US Energy Information Administration will release official oil stock data later in the day. In the case of a fall in stocks, a rise in oil prices is expected.

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