Petroleum prices dropped sharply on Wednesday as potential U.S. interest rate hikes that could slow growth and curb oil consumption outweighed strong Chinese economic data.
Brent crude futures shed $1.84, or 2.2%, to $82.93 U.S. a barrel while West Texas Intermediate U.S. crude fell by $1.82, also 2.25%, to $79.04.
Interest rate watchers say the U.S. Federal Reserve is likely to have one more rate rise in store, as the central bank continues to battle inflation.
Markets are pricing in an 86% chance of the Fed raising rates by 25 basis points at its May policy meeting.
The economy of top crude oil importer China grew by a faster than expected 4.5% in the first quarter and the country’s oil refinery throughput rose to record levels in March, data showed.
U.S. crude stocks, meanwhile, fell by about 2.68 million barrels last week, market participants citing American Petroleum Institute figures said on Tuesday. Gasoline and distillates inventories also fell last week, they said.
The official inventory report by the Energy Information Administration, the statistical arm of the U.S. Department of Energy, is due to be released on Wednesday.
