Crude oil fell over $2.00 per barrel on Monday as concerns rose over China’s protest due to strict Covid-19 policies.
After falling to $81.16 per barrel in the earlier session, the Brent contract slid to its lowest since January 11 by 2.60%, to $81.47 per barrel.
Consequently, the US West Texas Intermediate (WTI) dropped by 2.70% to $74.20 per barrel after hitting its lowest since December 27, 2021, at $73.82.
Both benchmarks posted three weeks of consecutive declines after dropping to their 10-month lows last week. In the latest week, Brent and WTI were down by 4.6% and 4.7%, respectively.
According to the General manager of research at Nissan Securities, Hiroyuki Kikukawa, the protest over China’s Covid policies caused political uncertainties, which prompted selling.
Kikukawa explained that these protests were an additional factor aside from the concerns over China’s growing Covid cases.
Also, he expects WTI to fall to $70.00 – $75.00 and that the OPEC+ meeting and Russian oil price cap might affect the market’s volatility.
Emori Fund Management Inc CEO Tetsu Emori also commented that the sentiment is growing due to concerns over China’s oil demand and unclear signs of further output cuts from oil producers.
Ultimately, oil prices may head further down unless the US reloads its strategic petroleum reserves and OPEC assents further production quota reduction.
Pakistan Delegation Will Visit Russia for Oil Talks
Pakistan’s Finance Minister Ishaq Dar stated in an interview that a delegation led by the country’s Petroleum State Minister Musadik Malik would visit Russia to discuss a cheap oil price import agreement.
The move is made to address the country’s rising petroleum prices and help the nation save more dollars.
According to Dar, at a meeting in Dubai on November 13, the US had allowed Pakistan to buy Russian oil since India has been doing the same. This was after Dar announced a month earlier that the US could not stop the country from buying oil from Russia.
Additionally, it is expected that there would be a discussion about the construction of the Pak-Stream Gas line, which would help in resolving the issues of logistics and availability of gas.
