Oil prices fell more than $ 5 a barrel on Monday as concerns about weaker fuel demand in China intensified after Shanghai launched a two-stage lockdown to curb rising rates.
The market began another week of uncertainty, with Russia’s war in Ukraine, the world’s second-largest oil exporter, and the expansion of lockdowns due to rising cases in China, the world’s largest crude importer.
Brent futures fell to $ 115.32 a barrel, down $ 5.15 or 4.3%, while West Texas Intermediate fell to $ 108.6 a barrel, falling 4.7%.
The Shanghai lockdown led to a new selloff from frustrated investors who expected such a lockdown to be avoided, analysts say.
Shanghai has launched a two-stage lockdown in the city of 26 million people, closing bridges and tunnels and restricting highway traffic to curb growing local cases.
Analysts have differing views on how hard Russian oil exports could be hit by economic sanctions imposed on Moscow by the United States and its allies after Russia’s invasion of Ukraine.
Some estimate that about 1-3 million barrels of Russian oil may not reach the market daily.
“Oil prices are likely to stay above $ 100 a barrel for a while, as global supply becomes tighter as supplies from Russia decline as the US moves into the summer (when demand increases due to travel).” said the CEO of Emori Fund Management.
Source: Capital
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