As traders concentrated on the risks of a recession, oil prices fell on Thursday, continuing a three-day losing run.
On the New York Mercantile Exchange, the West Texas Intermediate for April delivery fell 94 cents, or 1.23 percent, to close at 75.72 US dollars per barrel. On the London ICE Futures Exchange, Brent crude for May delivery fell $1.07, or 1.29 percent, to finish at $81.59 per barrel.
The market reacted as described above after data revealed initial unemployment claims in the United States for the week concluding March 4 were higher than anticipated.
“The report served as a bearish catalyst,” as it highlighted the negative impact of higher interest rates, Vladimir Zernov, analyst with market information supplier FX Empire, said on Thursday.
“Oil markets are moving lower as traders worry that Fed’s aggressive policy will put too much pressure on the economy,” he said.
In a testimony to the U.S. Congress earlier this week, Federal Reserve Chair Jerome Powell raised the potential for more aggressive interest rate hikes.
Powell said that “the ultimate level of interest rates is likely to be higher than previously anticipated,” and that the Fed would be prepared to increase rates at a faster pace if warranted by the “totality” of the data.
