Oil drops 3% as China lockdowns stoking demand fears

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Oil prices tumbled 3% on Thursday, as China’s new Covid-19 lockdown measures raised concerns that high inflation and rising interest rates are hurting demand for fuel.

Brent crude futures were down $3.12, or 3.26%, to $92.52 a barrel at 1:31 pm ET.

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U.S. WTI crude oil futures lost $2.82, or 3.15%, to $86.73 a barrel.

“Demand for oil from the Western world, like that from China, is stagnant while supply is expanding incrementally, largely due to the US shale boom,” said Norbert Rucker, an analyst at Julius Baer.

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Asia’s manufacturing activity fell in August, as “Covid zero” restrictions and cost pressures from China continued to hurt business, surveys showed on Thursday, dampening prospects for the region’s fragile recovery.

The main European stock index tumbled to seven-week lows as concerns mounted about aggressive rate hikes to fight record inflation.

Source: CNN Brasil

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