Oil price slump: Rising US interest rates cause petrol to fall again

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The US inflation report on Tuesday dashed hopes that the Fed could scale back its rate policy tightening in the coming months.

Inflation is still way above the two percent target set by the US central bank.

Brent crude futures fell 38 cents (33 pence), or 0.4 percent, to $92.79 (£80.55) a barrel by 4:07am GMT.

US West Texas Intermediate crude was at $87.02 (£75.54) a barrel, down 29 cents (25 pence), or 0.3 percent.

Tina Teng, an analyst at CMC Markets, said: “A strong US dollar and an expectation for another super-sized rate hike by the Fed weighed on sentiment.”

Fuel demand in China is also currently being affected by yet another COVID-19 lockdown.

Edward Moya, a senior market analyst at OANDA, said: “China’s zero-COVID policy remains intact and that will keep any rebounds that emerge over the coming weeks capped.

“The US is the big wildcard and if that demand outlook weakens, oil could resume its downward trajectory that has been in place since the start of the summer.”

According to market sources citing American Petroleum Institute figures on Wednesday, US crude stocks rose by about 6million barrels for the week ending September 9.

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According to a leaked document, they are still planning to push ahead with a windfall tax on energy company ‘surplus’ profits.

EU member states such as Hungary, Slovakia and Austria fear a price cap in case Putin responds by halting all gas from Russia, which would send their countries into recession.

The European Commission president, Ursula von der Leyen, is expected to publish Europe’s plan on dealing with surging electricity prices when she makes her annual state of the union speech today, reported The Guardian.

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