Worries that the United States is sliding into a recession have jolted oil traders after the Federal Reserve’s historic rate increase last week.
Crude oil was trading around $110 per barrel in the U.S. market on June 20, down from over $117 on June 16 and around $123 two days prior. The slump has started to translate into slightly lower prices at the gas pump with a gallon of regular gas dropping to an average of $4.98 after hovering above the $5 mark since mid-June.
The modest decrease indicates that traders are still confident in robust oil demand despite the Fed raising rates by 0.75 percent on June 15, the sharpest hike in more than two decades. The Fed is in the process of raising interest rates this year in order to tighten credit and thus the money supply. Inflation was up 8.6 percent year-over-year in May after the central bank printed trillions of dollars to pay for government spending packages during the COVID-19 pandemic….