TOKYOSINGAPORE, June 23 Reuters Oil prices continued to retreat on Thursday as investors reassessed the risks of recession and the impact ofinterest rate hikes in major economies on fuel demand.

U.S. West Texas Intermediate WTI crude futures fell 1.4, or 1.3, to 104.78 a barrel by 0643 GMT. Brent crude futures fell 1.3, or 1.2, to 110.40.

Both benchmarks tumbled by as much as 3 a barrel in early morning Asian trade, after plunging around 3 in the previous session. They are at their lowest levels since midMay.

Investors are continuing to assess how worried they need to be about central banks potentially pushing the world economy into recession as they attempt to curb inflation with interest rate increases.

Oil markets remained under pressure as investors were concerned that U.S. rate hikes would stall an economic recovery and dampen fuel demand, said Kazuhiko Saito, chief analyst at Fujitomi Securities Co Ltd.

The U.S. and European hedge funds have been selling off their positions ahead of the end of the second quarter, which is also cooling investor sentiment, he said, predicting WTI could fall below 100 a barrel before the July 4 holiday in the United States.

U.S. Federal Reserve chief Jerome Powell said on Wednesday the central bank was not trying to engineer a recession to stop inflation but was fully committed to bringing prices under control even if doing so risked an economic downturn.

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