China demand hopes offset by U.S. recession worries
U.S. crude inventories fall more than expected
LONDON, March 9 Reuters Oil fell for a third day on Thursday as fears over the economic impact of rising interest rates offset a surprise drop in U.S. crude inventories and hopes for Chinese demand.
U.S. Federal Reserve Chair Jerome Powell39;s comments this week on the likelihood that interest rates will need to be raised more than previously expected in response to recent strong data continued to weigh on oil and other risk assets because of the potential impact on economic and demand growth.
Brent crude fell by 34 cents, or 0.4, to 82.32 a barrel by 0902 GMT while U.S. West Texas Intermediate WTI crude slipped by 11 cents to 76.55. Both benchmarks declined between 4 and 5 over the previous two days.
Fears of recession are conspicuously rising, said Tamas Varga of oil broker PVM.
Oil prices on Tuesday registered their largest daily fall since early January after Powel39;s comments.
Oil prices are still under the influence of Powell39;s hawkish tone, said Suvro Sarkar, lead energy analyst at DBS Bank, pointing to the possibility of a 50 basis points rate hike rather than 25 basis points.
There was some support for oil from Wednesday39;s official figures on U.S. crude inventories, which fell 1.7 million barrels last week to end a 10week run of increases. That compared with expectations in a Reuters poll for a 400,000 barrel increase.
Oil has also drawn support…