(Update to closing. Edit wording and author signature)
By Shariq Khan
BENGALURU, Feb 22 (Reuters) – Oil prices fell more than $2 a barrel on Wednesday as investors feared recent economic data would imply more aggressive interest rate hikes, putting pressure on growth economy and fuel demand.
Brent crude futures for April delivery fell $2.38, or 2.9%, to $80.67 a barrel as of 1847 GMT, while West Texas Intermediate crude futures ( WTI) fell $2.37, or 3.1%, to $73.99 a barrel.
* If these levels hold, it will be Brent’s biggest daily decline since Jan. 4. WTI is on course for its biggest decline since Feb. 3.
* “While improving US economic data should translate into higher demand for oil, the concern is that this will force the Federal Reserve to excessively tighten monetary policy to control inflation,” said Giovanni Staunovo, analyst at UBS.
* “It also supports the US dollar, which is not helpful for oil,” he added.
* The US dollar index rose for the second straight session, making oil more expensive for non-cash buyers.
* Other US economic reports, however, showed worrying signs for the world’s biggest oil consumer. Existing home sales fell in January to their lowest level since October 2010.
* Morgan Stanley raised its global oil demand growth forecast for this year to around 36%, driven by the reopening of China and the recovery of aviation. (Additional reporting by Shariq Khan and Trixie Yap in Singapore; Spanish editing by Carlos Serrano)