Commodities and Futures News

Oil prices extend losses as Shanghai lockdowns hit demand outlook

2022.04.25 04:16

Oil prices extend losses as Shanghai lockdowns hit demand outlook
FILE PHOTO: A tap and meter shows zero level pressure on Druzhba oil pipeline at Hungarian oil and gas group MOL’s main Duna (Danube) refinery in Szazhalombatta January 9, 2007. REUTERS/Laszlo Balogh

By Yuka Obayashi

TOKYO (Reuters) – Oil prices extended losses on Monday amid persistent worries that prolonged COVID-19 lockdowns in Shanghai and potential U.S. rate hikes would dent global economic growth and fuel demand.

Brent crude futures slid $1.90, or 1.8%, to $104.75 a barrel at 0015 GMT, while U.S. West Texas Intermediate (WTI) crude futures fell $1.89, or 1.9%, to $100.18 a barrel.

The benchmarks lost nearly 5% last week on demand concerns.

“Bearish sentiment outweighed concerns over tight global supply as China continued lockdowns in Shanghai and investors prepared for a series of U.S. rate hikes,” said Hiroyuki Kikukawa, general manager of research at Nissan (OTC:NSANY) Securities.

Investors are trying to adjust their positions before the U.S. summer driving season kicks off later in May, he said.

“But oil prices are not expected to fall below $90 a barrel due to the prospect of a potential ban by European Union on Russian oil amid a deepening Ukraine crisis,” he said.

Shanghai authorities battling an outbreak of COVID-19 have erected fences outside residential buildings, sparking fresh public outcry over a lockdown that has forced much of the city’s 25 million people indoors.

The U.S. Federal Reserve Chairman Jerome Powell has indicated that a half-point interest rate increase “will be on the table” when the Fed meets in May to approve the next in what are expected to be a series of hikes this year.

On the supply side, U.S. energy firms added oil and natural gas rigs for a fifth straight week amid high prices and prodding by the government.

In Europe, the Russia-Kazakh Caspian Pipeline Consortium (CPC) was resuming full exports from April 22 after almost 30 days of disruptions following repairs on one of its key loading facilities, three sources familiar with the port loading plan told Reuters on Friday.

Still, some analysts say the worsening crisis in Ukraine could raise pressure on the EU to sanction Russian oil and prices could move higher later this year.

Russia is Europe’s top gas supplier and the world’s second-biggest oil exporter after Saudi Arabia.

Morgan Stanley (NYSE:MS) raised its third-quarter price forecast for Brent by $10 per barrel to $130 citing a “greater deficit” this year due to lower supply from Russia and Iran, which is likely to outweigh short-term demand headwinds.

Source

Related Articles

Leave a Reply

Back to top button
bitcoin
Bitcoin (BTC) $ 103,152.64 2.02%
ethereum
Ethereum (ETH) $ 2,339.06 14.36%
tether
Tether (USDT) $ 1.00 0.01%
xrp
XRP (XRP) $ 2.36 5.56%
bnb
BNB (BNB) $ 636.10 2.82%
solana
Solana (SOL) $ 171.68 7.96%
usd-coin
USDC (USDC) $ 1.00 0.00%
dogecoin
Dogecoin (DOGE) $ 0.205357 8.00%
cardano
Cardano (ADA) $ 0.785412 7.30%
tron
TRON (TRX) $ 0.262783 3.06%
staked-ether
Lido Staked Ether (STETH) $ 2,337.22 14.54%
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 103,314.68 2.11%
sui
Sui (SUI) $ 3.92 0.12%
chainlink
Chainlink (LINK) $ 16.05 5.20%
avalanche-2
Avalanche (AVAX) $ 23.37 9.89%
wrapped-steth
Wrapped stETH (WSTETH) $ 2,809.80 14.23%
stellar
Stellar (XLM) $ 0.296461 5.13%
shiba-inu
Shiba Inu (SHIB) $ 0.000015 7.77%
hedera-hashgraph
Hedera (HBAR) $ 0.200966 5.63%
hyperliquid
Hyperliquid (HYPE) $ 24.93 13.80%
bitcoin-cash
Bitcoin Cash (BCH) $ 409.63 1.97%
the-open-network
Toncoin (TON) $ 3.27 2.17%
leo-token
LEO Token (LEO) $ 8.69 1.36%
usds
USDS (USDS) $ 1.00 0.01%
litecoin
Litecoin (LTC) $ 99.26 7.37%
polkadot
Polkadot (DOT) $ 4.84 12.92%
weth
WETH (WETH) $ 2,339.69 14.57%
monero
Monero (XMR) $ 308.61 5.22%
wrapped-eeth
Wrapped eETH (WEETH) $ 2,491.83 14.06%
bitget-token
Bitget Token (BGB) $ 4.47 0.67%
binance-bridged-usdt-bnb-smart-chain
Binance Bridged USDT (BNB Smart Chain) (BSC-USD) $ 1.00 0.26%
pepe
Pepe (PEPE) $ 0.000012 21.35%
pi-network
Pi Network (PI) $ 0.724408 15.10%
ethena-usde
Ethena USDe (USDE) $ 1.00 0.09%
coinbase-wrapped-btc
Coinbase Wrapped BTC (CBBTC) $ 103,102.62 2.05%
whitebit
WhiteBIT Coin (WBT) $ 30.34 1.82%
uniswap
Uniswap (UNI) $ 6.36 15.20%
bittensor
Bittensor (TAO) $ 426.20 2.70%
near
NEAR Protocol (NEAR) $ 2.91 12.15%
dai
Dai (DAI) $ 1.00 0.02%
aptos
Aptos (APT) $ 5.55 6.17%
ondo-finance
Ondo (ONDO) $ 1.02 7.63%
okb
OKB (OKB) $ 53.53 2.11%
aave
Aave (AAVE) $ 209.90 10.22%
susds
sUSDS (SUSDS) $ 1.05 0.01%
ethereum-classic
Ethereum Classic (ETC) $ 19.22 8.62%
crypto-com-chain
Cronos (CRO) $ 0.101203 4.78%
blackrock-usd-institutional-digital-liquidity-fund
BlackRock USD Institutional Digital Liquidity Fund (BUIDL) $ 1.00 0.00%
internet-computer
Internet Computer (ICP) $ 5.41 8.71%
official-trump
Official Trump (TRUMP) $ 14.05 13.25%