Monitoring Desk
LONDON: Oil prices fell sharply on Wednesday following a slump in the previous session due to demand concerns stemming from the global economic situation and increasing COVID cases in China.
Brent futures fell $3.04 to $79.06 per barrel for a 3.7 percent loss by 1452 GMT. US crude oil dropped $2.91, or 3.8 percent, to $74.02.
Both benchmarks plunged over 4 percent on Tuesday, with Brent suffering its significant one-day decline in over three months.
“Worries regarding the state of the global economy are front and center of minds of traders and will remain so for the near future,” PVM Oil analyst Stephen Brennock said.
Downward trend of oil prices
The Chinese government also surged export quotas for refined oil products in the first batch for the current year, signalling expectations of poor local demand.
Major oil exporter Saudi Arabia could reduce prices for its main Arab Light crude grade to Asia in February. Prices for Arab Crude grade have been set at a 10-month low for January as concern about oversupply continued to cloud the market.
The International Monetary Fund (IMF) head warned that much of the international economy would face a challenging year because the main engines of global economic growth — China, the United States, and Europe — were all experiencing slowing activity.
