New York. The price of Texas Intermediate Oil (WTI) fell 7% to $105.96 a barrel in reaction to the lockdowns imposed in Shanghai (China) to curb a resurgence of covid-19.
According to data at the end of operations on the New York Mercantile Exchange (Nymex), WTI futures contracts for delivery in May cut 7.94 dollars from the previous close. The benchmark US crude oil thus canceled out the revaluation of the previous week due to fears that restrictions on movement in one of China’s most important metropolises will have an impact on global energy demand. Analysts pointed out that this measure, which will last two weeks and partially affects some 24 million people, could reduce demand from China, the world’s largest oil importer, by some 200,000 barrels a day.
European benchmark Brent oil suffered from the same concerns and fell more than 6%. In parallel, the market remained aware of the Russian invasion of Ukraine, which began more than a month ago, and the ramifications of the economic punishment imposed by Western countries to Moscow, which has raised energy prices. Likewise, investors were also attentive to the monthly meeting of OPEC producers and their allies, next Thursday, to review their plan to gradually increase the supply of crude agreed last summer. “Reports that OPEC+ is likely to stick to its plan for May production increases, again about 400,000 barrels a day, … seem to have contributed to the declines,” said Craig Erlam of l Oanda.
Natural gas contracts for April delivery fell 6 cents to $5.51 per thousand cubic feet, and gasoline contracts due the same month fell 25 cents to $3.22 a gallon.
