May 3 Reuters Oil prices extended losses on Wednesday after plunging 5 in the previous session, as investors fretted about the health of the U.S. economy ahead of an expected Federal Reserve interest rate hike later in the day.

Brent futures fell 2.27, or 3, to 73.05 a barrel by 1105 GMT, while West Texas Intermediate crude WTI fell 2.28, or 3.1, to 69.38.

Both benchmarks closed at their lowest since late March in the previous session, when they also recorded their biggest oneday percentage declines since early January.

The Federal Reserve is expected to deliver another quarterpoint increase later today as part of its longrunning battle against inflation, PVM Oil analyst Stephen Brennock said.

He added that concerns about the health of the U.S. banking sector and downbeat U.S. jobs data did nothing to dispel fears that the U.S. economy is barrelling towards a shallow recession.

The Fed is expected to hike interest rates by an additional 25 basis points on Wednesday to combat inflation, while the European Central Bank is also expected to raise rates at its regular policy meeting on Thursday.

More hikes could slow economic growth and hit energy demand.

Energy prices are also under pressure after data from China over the weekend showed manufacturing activity fell unexpectedly in April. China is the world39;s largest energy consumer and top buyer of crude oil.

The postpandemic reopening of China39;s economy will be pivotal for Asia, the International Monetary Fund…