Oil fell amid anticipation of the US interest rate decision

Oil prices fell by $2 on Monday ahead of a Federal Reserve meeting as investors try to figure out the bank’s direction with regard to raising interest rates, while concerns about growing fuel demand in China and rising Russian crude supplies weighed on the market.

Brent crude futures fell $1.91, or 2.5 percent, to $72.88 a barrel by 0902 GMT. West Texas Intermediate crude fell $2.02, or 2.8%, to $86.15 a barrel.

And the two benchmarks suffered a second consecutive weekly loss last week after disappointing Chinese economic data raised concerns about demand growth in the world’s largest crude importer, which outweighed the price recovery due to Saudi Arabia’s decision to cut production by one million barrels per day in July.

Most players expect the US central bank to keep rates unchanged at the close of the monetary policy meeting on Wednesday. A rate hike boosts the greenback, making dollar-denominated commodities more expensive for holders of other currencies and putting pressure on prices.

Goldman Sachs cut its oil price forecast due to higher-than-expected supply from Russia and Iran, and raised its forecast for supply from the two countries and Venezuela in 2024 by 800,000 barrels per day.