As European data indicated an economic slowdown in the offing and the US Federal Reserve signaled there are more rate hikes to come, oil registered the largest weekly fall since early May.

Over the course of the week, West Texas Intermediate fell almost 4%, the most seen since May 5th. Brent Crude was off more than 2% for the week.

This week Fed Chair Jerome Powell indicated  that the Federal Reserve was not done with its policy of monetary tightening, and there would be more rate hikes in the second half of the year. On Friday new data showed that German economic activity slowed much faster than analysts had predicted in June, while France’s economy likely entered a contraction in the second quarter. Meanwhile Powell’s comments lifted the dollar, causing commodities priced in the dollar to lose their appeal to traders.

Robert Yawger, director of the futures division at Mizuho Securities USA said, “Fear of higher rates and the associated slowdown in economic activity is putting pressure on the oil patch.” He noted that higher rates will increase the cost of carry, increasing the costs of everything from the storage of oil to shipping it.

Technical trading in recent days has also exacerbated the pace of the moves in the oil markets, as both Brent and West Texas Intermediate fell away sharply following testing of the upper bands in which they’ve been trapped since the beginning of May.

Oil appears poised for a second quarterly loss in a row, as traders worry global demand is declining. Even as OPEC+ has pledged to reduce production output, and Saudi Arabia recently pledged an additional one million barrel per day voluntary cut in its output, global demand appears poised for drops in demand to outstrip declines in output.

Brent’s prompt spread, viewed as a key gauge of market health, has weakened heavily in recent days, reaching its softest point since January.