Oil prices continued to decline on Wednesday after falling about 5% in the previous session to their lowest level in five weeks, as investors anticipate further interest rate hikes this week. Brent crude futures dropped 0.2% to $75.19 per barrel, while West Texas Intermediate crude fell 0.2% to $71.53.
Both benchmark oils closed at their lowest levels since March 24 in the previous session, where they also recorded the largest percentage drop in a single day since early January.
The Federal Reserve (the U.S. central bank) is expected to raise interest rates by 25 basis points on Wednesday to curb inflation, while the European Central Bank is also anticipated to increase rates in its regular meeting tomorrow, Thursday.
Further interest rate hikes could lead to a slowdown in economic growth and undermine energy demand. Energy prices are also under pressure after Chinese data earlier this week showed an unexpected decline in manufacturing activity in April.
