# Oil falls on concerns economic slowdown may dent fuel demand Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-08-22 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Oil Prices Fall on Fears of U.S. Rate Hikes Impacting Meta Description: Oil prices fell on fears of aggressive U.S. interest rate hikes causing global economic slowdown and denting fuel demand. Brent crude fell to $95.55 a barrel. URL: https://financedigest.com/oil-falls-on-concerns-economic-slowdown-may-dent-fuel-demandhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-08-22t013404z2lynxmpei7l00xrtroptp4global-oil-prices-1736815416682-compressed.jpg) By Yuka Obayashi TOKYO (Reuters) – Oil prices fell on Monday, ending three days of gains, on fears aggressive U.S. interest rate hikes may lead to a [global economic slowdown and dent fuel demand](https://www.financedigest.com/global-factory-activity-weakens-as-demand-falters.html "Global factory activity weakens as demand falters"). Brent crude futures for October settlement declined $1.17, or 1.2%, to $95.55 a barrel by 0054 GMT, with concerns over slowing [demand in China because of a power crunch in some areas also weighing on prices](https://www.financedigest.com/oil-prices-rebound-after-opec-upgrades-china-demand-outlook.html "Oil prices rebound after OPEC upgrades China demand outlook"). U.S. West Texas Intermediate (WTI) crude [futures for September delivery](https://www.financedigest.com/intelligent-delivery-the-future-of-ecommerce-and-retail.html "Intelligent delivery: the future of eCommerce and retail"), due to expire on Monday, was down $1.12, or 1.2%, at $89.65 a barrel. The more [active October contract](https://www.financedigest.com/asias-factory-activity-contracts-despite-chinas-covid-reopening.html "Asia’s factory activity contracts despite China’s COVID reopening") was at $89.29, down $1.15, or 1.3%. Both Brent and WTI climbed for a third straight day on Friday, but fell about 1.5% for the week on a stronger dollar and [demand fears](https://www.financedigest.com/oil-rises-on-demand-hopes-as-banking-crisis-fears-subside.html "Oil rises on demand hopes as banking crisis fears subside"). [“Investors were worried that a possible steep rate hike by the Fed would cause an economic](https://www.financedigest.com/hotel-investors-should-they-be-worried-about-a-potential-economic-pause-delving-into-inflation-interest-rates-recession-etc.html "‘Hotel Investors – should they be worried about a potential economic pause?’ delving into inflation, interest rates, recession etc") slowdown and sap fuel demand,” said Hiroyuki Kikukawa, general manager of research at Nissan Securities. China’s power restriction in some regions is also a [concern as it could affect economic](https://www.financedigest.com/oil-near-flat-as-us-crude-stock-draw-contends-with-economic-concerns.html "Oil near flat as US crude stock draw contends with economic concerns") activity,” he added. [China’s southwestern province Sichuan began limiting electricity supply](https://www.financedigest.com/oil-prices-rise-as-china-eases-covid-curbs-u-s-storm-fuels-supply-worries.html "Oil prices rise as China eases COVID curbs, U.S. storm fuels supply worries") to homes, offices and malls last week because of a severe power crunch driven by extreme heat waves and drought, according to state media and one power company. Strength in the U.S. dollar, which was hovering at around a five-week high, also weighed on [crude prices because it makes oil](https://www.financedigest.com/oil-dips-after-fed-comments-us-crude-stock-build.html "Oil dips after Fed comments, US crude stock build") more expensive for buyers in other currencies. \[FRX/\] [Investors will be paying close attention to comments by Fed](https://www.financedigest.com/oil-steadies-after-dipping-on-china-outlook-investors-await-fed-clues.html "Oil steadies after dipping on China outlook; investors await Fed clues") Chair Jerome Powell when he addresses an annual global central banking conference in Jackson Hole, Wyoming, on Friday. U.S. central [bank officials have “a lot of time still” before they need to decide how large an interest rate](https://www.financedigest.com/bank-of-england-officials-split-over-future-path-for-rates.html "Bank of England officials split over future path for rates") increase to approve at their Sept. 20-21 [policy meeting](https://www.financedigest.com/opec-abandons-oil-policy-meeting-after-saudi-uae-clash.html "OPEC+ abandons oil policy meeting after Saudi-UAE clash"), Richmond Federal Reserve President Thomas Barkin said on Friday. The Fed is [seen as having more room to hike rates than central banks of other large economies](https://www.financedigest.com/bank-of-canada-seen-on-hold-even-as-economy-accelerates.html "Bank of Canada seen on hold even as economy accelerates") which are more fragile. Meanwhile, the leaders of the United States, Britain, [France and Germany discussed efforts to revive the 2015 Iran nuclear](https://www.financedigest.com/france-seeks-strategy-as-nuclear-waste-site-risks-saturation-point.html "France seeks strategy as nuclear waste site risks saturation point") deal, the White House said on Sunday, though no further details were provided. The [European Union](https://www.financedigest.com/explainer-why-malaysia-is-considering-a-ban-on-palm-oil-exports-to-the-european-union.html "Explainer-Why Malaysia is considering a ban on palm oil exports to the European Union") and United States said last week they were studying Iran’s response to what the EU has called its “final” proposal to revive the deal, under which Tehran curbed its nuclear program in return for economic sanctions relief. (Reporting by Yuka Obayashi; Editing by Jamie Freed) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---