WASHINGTON (dpa-AFX) - Despite data showing a drop in crude inventories, oil prices fell sharply on Thursday as interest rate hikes and inflation concerns triggered growth worries and raised concerns about the outlook for fuel demand.
Following Fed Chair Jerome Powell's comments that signaled more interest rate hikes by the U.S. Central Bank, the Bank of England today announced a larger-than-expected 50-basis point hike in rates, and the Swiss National Bank raised its rate by 25 basis points.
The dollar index climbed to 102.47, gaining about 0.4%, adding more pressure on the commodity.
West Texas Intermediate Crude oil futures for August ended lower by $3.02 at $69.51 a barrel.
Brent crude futures settled at $74.14 a barrel, losing $2.98 or about 3.9%.
Data released by Energy Information Administration (EIA) this morning showed crude inventories in the U.S. fell by 3.8 million barrels last week, as against forecasts for a rise of 300,000 barrels.
The EIA data showed gasoline stocks increased by about 480,000 barrels last week, nearly five times the expected rise. Meanwhile, distillate stockpiles rose by about 430,000 barrels in the week, as against an expected increase of 700,000 barrels.
Oil stored at Cushing, Okla., the delivery point for U.S. stocks, decreased by 98,000 barrels from the previous week to 42 million barrels, the EIA said in its weekly report.
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