Oil drops as new COVID cases in China trigger clampdowns

Oil drops as new COVID cases in China trigger clampdowns

Reuters  | Jan 22, 2021 10:10

Oil drops as new COVID cases in China trigger clampdowns

MELBOURNE, Jan 22 (Reuters) - Oil prices fell in early trade
on Friday, retreating further from 11-month highs hit last week,
on worries new pandemic restrictions in China will curb fuel
demand in the world's biggest oil importer.
U.S. West Texas Intermediate (WTI) crude CLc1 futures
dropped 47 cents, or 0.9%, to $52.66 a barrel at 0148 GMT, after
slipping 18 cents on Thursday.
Brent crude LCOc1 futures fell 45 cents, or 0.8%, to
$55.65 a barrel, erasing a 2 cent gain on Thursday.
Recovering fuel demand in China underpinned market gains
late last year while the United States and Europe lagged, but
that source of support is fading as a fresh wave of COVID-19
cases has sparked new restrictions to contain the spread.
"Indeed, investors are struggling to see through short-term
pain for long-term gain heading into the weekend as COVID case
counts in China are the most significant demand concern for
traders," Axi chief market strategist Stephen Innes said in a
note.
The commercial hub of Shanghai reported its first locally
transmitted cases in two months on Thursday. Local governments in areas yet to be hit by big outbreaks
are adopting new curbs, and Beijing is urging people not to
travel during the upcoming Lunar New Year holiday, when tens of
millions of urban workers typically head back to their villages.
Sudden new restrictions worldwide have badly hit the airline
industry, with the number of flights globally down 25% last
week, ANZ Research said.
"This is likely to weigh heavily on jet fuel demand," ANZ
Research said in a note.
The market is awaiting official oil inventory data from the
U.S. Energy Information Administration on Friday, after industry
data on Wednesday showed a surprise 2.6 million barrel increase
in U.S. crude inventories last week compared with analysts'
forecasts for a 1.2 million barrel draw. API/S
The EIA weekly report has been delayed by two days due to
the Martin Luther King Jr. holiday and Inauguration Day.

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Discussion
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (UK) English (India) English (Canada) English (Australia) English (South Africa) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Polski Português (Portugal) Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes

+

Download the Investing.com App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.

Investing.com is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.