West Texas Intermediate fell below US$77 a barrel as the Federal Reserve’s tightening cycle risks tipping the US, the world’s largest economy, into recession and potentially harming oil demand.
Oil fell after four weekly gains as traders weighed prospects for another rate increase from the Federal Reserve against signs of a tighter market.
West Texas Intermediate dropped below US$77 a barrel after closing at a three-month high on Friday. That upswing was driven by expectations that supply cuts by Opec+ would reduce inventories, with International Energy Agency executive director Fatih Birol saying at the weekend the market could return to a deficit.
US central bank policymakers are widely expected to deliver another rate increase at this week’s meeting in their push to rein in inflation, and give guidance on the likelihood of additional moves.
