Low growth in China and anxiety over US rate hikes have caused oil prices to decline

17 Aug 2023 , 09:55 AM

Early on Thursday, oil prices declined, extending losses to a fourth straight session as concerns over China’s slowing development and potential future U.S. interest rate hikes weakened demand for fuel in the two largest economies in the world.

WTI was down 39 cents, or 0.49%, to $78.99 per barrel, while Brent crude futures dropped 37 cents, or 0.44%, to $83.08 per barrel.

Worries that China’s worsening real estate sector problem is choking what little economic momentum there is have increased in response to missed payments on investment products by a major Chinese trust firm and a decline in home prices.

This week, China’s central bank unexpectedly reduced key policy rates for the second time in three months, but economists are concerned that this may not be sufficient to halt the economy’s slide.

The U.S. Federal Reserve’s July meeting minutes, which were made public on Wednesday, revealed that the majority of its policymakers still gave the fight against inflation top priority.

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