Investing.com - Oil prices dropped on Wednesday after the Organisation for Economic Co-operation and Development (OECD) and the International Monetary Fund trimmed their growth forecasts for China, the world's second-largest consumer of oil.
The growth revisions fanned concerns that the world will demand less energy and fuel than once anticipated.
On the New York Mercantile Exchange, light sweet crude futures for delivery in July traded down 1.71% at USD93.39 a barrel on Wednesday, off from a session high of USD95.22 and up from an earlier session low of USD93.12.
The International Monetary Fund said earlier it was cutting its growth forecast for China this year to 7.75% from 8%, while the OECD cut its growth outlook for the Asian giant to 7.8% from 8.5%, which prompted a selloff in energy markets, which are sensitive to economic growth indicators.
Meanwhile, growing expectations that the U.S. Federal Reserve will wind down stimulus measures soon fueled the selloff as well.
Stimulus tools, such as the Fed's monthly USD85 billion bond-buying program, weaken the dollar to spur recovery, and talk of the dismantling supports the greenback.
A stronger greenback makes oil less attractive in dollar-denominated exchanges, especially in the eyes of investors holding other currencies.
Energy traders kept an eye towards Thursday, when the U.S. government will release official crude and gasoline stockpile data.
Elsewhere on the ICE Futures Exchange, Brent oil futures for July delivery were down 1.30% at USD102.88 a barrel, up USD9.49 from its U.S. counterpart.
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