Oil prices recover on tight supplies, firm demand outlook

Oil prices recovered on Thursday from a steep drop in the previous session, supported by tight oil supply and peak summer consumption, after a hefty U.S. rate hike sparked fears of slower economic growth and less fuel demand, Reuters reported.

Brent crude futures rose 86 cents, or 0.7%, to $119.37 a barrel by 0644 GMT while U.S. West Texas Intermediate (WTI) crude futures climbed to $116.27 a barrel, up 96 cents, or 0.8%.

Prices slipped more than 2% overnight after the Federal Reserve raised its key interest rate by three-quarters of a percentage point, the biggest hike since 1994.

Investors remained focused on tight supplies and robust demand as Western sanctions restricted access to Russian oil.