(Bloomberg) -- Oil dropped for a fourth day on concerns over the Chinese economy and the possibility of even tighter US monetary policy.Most Read from BloombergFed Saw ‘Significant’ Inflation Risk That May Merit More HikesGoldman CEO’s Most Loyal Deputy Is Tested by Mutinous PartnersStocks, Bonds Fall as Rate Hikes Left on the Table: Markets WrapChina Shadow Bank Misses Dozens of Payments as Risks GrowHigh-Potency Pot Market Worth Billions Draws Regulator ScrutinyWest Texas Intermediate fell tow
West Texas Intermediate fell toward $79 a barrel, with futures on track for their longest daily losing run since May. Worries over top importer China’s post-pandemic recovery have taken center stage this week despite vows of support from policymakers. That’s hurt appetite for risk assets including commodities.
In the US, Federal Reserve officials remained concerned that inflation would fail to recede and that further interest rate rises could be needed, according to minutes from the central bank’s July meeting. Higher borrowing costs may hurt energy demand, while supporting gains in the US dollar. Oil remains well above the lows hit in June after OPEC+ heavyweights Saudi Arabia and Russia reduced supplies, and there have been further signs of tightening this week. US nationwide crude inventories have contracted to the lowest level since January after dropping for four of the past five weeks, according to figures from the Energy Information Administration.
“The oil market has been unable to escape broader market concerns following a raft of weaker-than-expected Chinese macro data this week,” said Warren Patterson, head of commodities strategy at ING Groep NV. “However, we remain constructive on oil, given the expectation that fundamentals will continue to tighten due to ongoing supply cuts from OPEC+.”Most Read from Bloomberg Businessweek
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