Oil Loses Steam: Tumbles As Top Importer China Resorts to Rigid Covid Policy – Investing NewsEverything

By Malvika Gurung

Invetsing.com — Oil prices tumbled on Monday, following concerns about growing demand pressures from the world’s largest oil importer China amid a resurgence in fresh Covid-19 infections in the country.

Oil tanked over 2% in early trade as the new began, after officials from China’s National Health Commission reiterated their commitment to maintaining the zero-COVID policy, as the country faces its worst outbreak in nearly six months.

The economically disruptive policy on battling the deadly virus involves strict movement curbs and lockdown measures, which has smashed hopes of an oil demand rebound in the oil importing major.

At the time of writing, Futures fell 1.3% to $97.5/barrel and slid 1.4% to $91.3/barrel, dropping to a low of $90.4/barrel in the session, tumbling from monthly highs. The Futures jumped 2.9% and 5.4%, respectively last week amid expectations and rumours of the COVID-19 lockdowns possibly ending. 

However, the country’s health officials have restated their ‘dynamic-clearing’ approach to COVID cases as soon as they emerge.

A rising is also weighing on oil prices, stated Tina Teng of CMC (NS:) Markets. 

Analysts at ANZ expect the global demand in Q4 to growing by only 0.6 millions of barrels/day YoY and moderate next year, as the market is still dealing with signs of weakness in oil demand from already high prices and the weak economic backdrop in developed markets.