{"id":2481,"date":"2022-11-28T15:12:27","date_gmt":"2022-11-28T15:12:27","guid":{"rendered":"http:\/\/roydadnaft.ir\/English\/?p=2481"},"modified":"2022-11-28T15:12:28","modified_gmt":"2022-11-28T15:12:28","slug":"oil-prices-erase-2022-gains-as-chinas-protests-spark-demand-worries","status":"publish","type":"post","link":"https:\/\/roydadnaft.ir\/English\/2481\/","title":{"rendered":"Oil prices erase 2022 gains as China’s protests spark demand worries"},"content":{"rendered":"
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Oil prices fell close to their lowest this year on Monday as street protests against strict COVID-19 curbs in China, the world’s biggest crude importer, stoked concern over the outlook for fuel demand.<\/p>\n\n\n\n

Brent crude dropped by $2.67, or 3.1%, to trade at $80.96 a barrel at 1330 GMT, having dived more than 3% to $80.61 earlier in the session for its lowest since Jan. 4.<\/p>\n\n\n\n

U.S. West Texas Intermediate (WTI) crude slid $2.09, or 2.7%, to $74.19 after touching its lowest since Dec. 22 last year at $73.60.<\/p>\n\n\n\n

Both benchmarks, which hit 10-month lows last week, have posted three consecutive weekly declines.<\/p>\n\n\n\n

\"Reuters<\/figure>\n\n\n\n

“On top of growing concerns about weaker fuel demand in China due to a surge in COVID-19 cases, political uncertainty caused by rare protests over the government’s stringent COVID restrictions in Shanghai prompted selling,” said Hiroyuki Kikukawa, general manager of research at Nissan Securities.<\/p>\n\n\n\n

Markets appeared volatile ahead of an OPEC+ meeting this weekend and a looming G7 price cap on Russian oil.<\/p>\n\n\n\n

China has stuck with President Xi Jinping’s zero-COVID policy even as much of the world has lifted most restrictions.<\/p>\n\n\n\n

Hundreds of demonstrators and police clashed in Shanghai on Sunday night as protests over the restrictions flared for a third day and spread to several cities.<\/p>\n\n\n\n

The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, a group known as OPEC+, will meet on\u00a0Dec. 4.\u00a0In October OPEC+ agreed to reduce its output target by 2 million barrels per day through 2023.<\/p>\n\n\n\n

Advertisement \u00b7 Scroll to continue<\/p>\n\n\n\n

Meanwhile, Group of Seven (G7) and European Union diplomats have been discussing a price cap on Russian oil of between $65 and $70 a barrel, with the aim of limiting revenue to fund Moscow’s military offensive in Ukraine without disrupting global oil markets.<\/p>\n\n\n\n

However, EU governments were split on the level at which to cap Russian oil prices, with the impact being potentially muted.<\/p>\n\n\n\n

“Talks will continue on a price cap but it seems it won’t be as strict as first thought, to the point that it may be borderline pointless,” said Craig Erlam, senior markets analyst at OANDA<\/p>\n\n\n\n

“The threat to Russian output from a $70 cap, for example, is minimal given it’s selling around those levels already.”<\/p>\n\n\n\n

The price cap is due to come into effect on Dec. 5 when an EU ban on Russian crude also takes effect.<\/p>\n

Updated on