Oil prices plummet to two-week lows

February 23, 2023 (MLN): The oil prices hit a two-week low, falling by $2 per barrel as investors grew more worried about recent economic data that could result in central banks increasing interest rates more aggressively.

This, in turn, could put pressure on economic growth and fuel demand. Brent crude futures settled at $80.60 per barrel, down 3%, while West Texas Intermediate crude futures (WTI) ended at $74.05 a barrel, a drop of 3%.

The minutes from the latest U.S. Federal Reserve meeting showed that a majority of Fed officials believed that the risks of high inflation remained a "key factor" in shaping monetary policy and that continued rate hikes were necessary until inflation was controlled, as Reuters reported.

UBS analyst Giovanni Staunovo expressed concerns that while better U.S. economic data could indicate stronger oil demand, the Fed's efforts to control inflation could result in overly tight monetary policy.

The drop in oil prices was part of a broader sell-off in financial markets as investors weighed the impact of rising interest rates on economic growth and corporate earnings.

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