Oil prices hover near two-month lows on Chinese demand concerns

2022-11-21 13:28PM UTC

Oil prices fell in European trade on Monday for the fourth straight session, almost hitting two-month lows as Chinese demand weakens amid mounting Covid 19 infections in major cities. 


A surge in dollar against major currencies also pressured dollar-denominated oil futures as they become costlier to holders of other currencies. 


Global Oil Prices


US crude fell 1.25% to $79.14 a barrel, while Brent shed over 1.4% to $86.45 a barrel, with a session-high at $87.94. 


US crude lost 2.3% on Friday, hitting two-month lows at $77.24 a barrel, while Brent tumbled 2.5% to $85.84 a barrel, the lowest since September 30.


Global oil prices lost 9% on average last week, the second weekly loss in a row, and the largest since late March on global demand concerns. 


Chinese Demand


Covid 19 infections in China continue to rise in major cities including Beijing, with movement restrictions getting reinstated once more. 


Even as Covid 19 infections in China remain small compared to the rest of the world, the Chinese government continue to take a very strict approach against it. 


Chinese government said a few weeks ago it won't budge on its zero tolerance policy for Covid 19 as infections reach six-month high.


The Dollar


The dollar rose 0.9% today on track for the third profit in a row, hitting two-week highs at 107.90 against a basket of major rivals. 


The gains came following a batch of bullish statements from Fed officials, which bolstered the case once more for a 0.75% rate hike in December.

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