Bent Crude Oil Prices Slashed Down Internationally.
Oil prices fell to a 10-month low on Monday morning after a stern warning from Chinese authorities highlighted the country’s growing concern over the Covid outbreak – suggesting that the use of ‘hand around the economy and also fueling hopes that gas prices could drop below $3 a gallon for the first time. in 18 months.
The price of West Texas Intermediate slid more than 5% on Monday to below $75.50 a barrel – its lowest level since early January – while international benchmark Brent crude fell 5% to around 82, $50 a barrel.
In a morning note, Oanda analyst Ed Moya said the decline was due to the worsening of the Covid outbreak in China, while the deputy director of Beijing’s Center for Disease Control and Prevention warned on Monday that the country is facing “tight restrictions and controls of the pandemic after China reported its first Covid death since May at the weekend.
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“It seems like a zero-sum forecast—Covid won’t go away any time soon — and that’s going to hit global growth,” Moya said, adding that oil prices will continue to fall if it is at least below expectations. Demand for oil is ‘worsening’ from China and the United States, while the prospect of a rail strike ‘may be a source of concern for the slowing US economy.
Following the decline, Patrick De Haan, head of oil research at GasBuddy, said that if the oil market continues at current levels, the price and pump should fall “almost n “coast during the Thanksgiving holiday” – may even push the national average less than $3 around Christmas.
As the price of oil fell more than 18% this month, the price of gas in the country fell in tandem, losing almost 12 cents from a week ago to $ 3.64 per month. gallon, GasBuddy reported Monday.
Investors derided an announcement from China last week that it would ease the impact of a strict zero-covid-19 policy to boost economic activity and power, but analysts said the lockdown and the rise in the number continued to be a major threat.
Tamas Varga of oil broker PVM said, “The increase in COVID cases in Beijing and other cities reminded us that a change in economic growth and demand for oil imports worldwide is imminent.”
Cases of COVID in the country rose further on Tuesday last, including in the capital Beijing, and the country’s industrial production slowed. Investment bank JPMorgan cut its quarterly and annual forecasts for China’s economic growth on Tuesday due to the country’s ongoing COVID restrictions.
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Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) cut its global oil growth forecast for 2022 for the fifth time since April, citing growing economic challenges. including high inflation and price increases. However, concerns over the harsh conditions this winter continued to support oil prices.
The European Union’s ban on Russia will begin on December 21. 5. This restriction will follow the suspension of the importation of petroleum products in February. An EU ban on Russian oil shipments at sea means 1.1 million barrels a day will be replaced, the International Energy Agency said on Tuesday.
