Oil dropped as a massive increase in US crude stockpiles and the Federal Reserve’s hints that rate hikes will continue crushed the risk-on sentiment that prevailed earlier in the day.

West Texas Intermediate settled below $69 after swinging more than $2 throughout the session. Prices reversed earlier gains after US stockpiles rose 7.92 million barrels, and inventories at the key storage hub in Cushing, Oklahoma, swelled to the highest since 2021. Many Wall Street banks have slashed their oil price estimates, largely because they see stockpiles rising and outweighing demand.

Federal Reserve officials paused their interest-rate hikes on Wednesday after 15 months of increases, but signaled they would likely resume tightening to cool inflation. The prospect of additional hikes has inflamed concerns about a demand-reducing recession.

“The market is looking for a line of sight to the end of the hiking cycle for some confidence and to bring back some fundamental investors,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth. The prospect of more hikes in the second half “is not easing fears about macro headwinds for crude.”

Crude has been largely range-bound since the start of May, as stubbornly high Russian supplies and concern about global demand counteract Saudi-led OPEC+ efforts to curb production. JPMorgan Chase & Co. became the latest oil bull to cut its forecast on Wednesday, with the bank saying OPEC+ action will no longer balance markets this year.

World oil markets may tighten “significantly” over the next few months as China’s fuel consumption rebounds from the pandemic amid OPEC+ curbs, the International Energy Agency said in a report Wednesday. Earlier, a large batch of Chinese crude import quotas also added to an improved outlook for consumption in the world’s second-largest economy.