Global crude oil news

11 Oct 2022 , 08:26 AM

Tuesday’s decline in oil prices followed losses of almost 2% in the previous session as concerns about a slowing global demand were heightened by a stronger US dollar and an uptick in COVID-19 cases in China.

After sliding $1.73 the day before, Brent crude futures were down 57 cents, or 0.6%, at $95.62 a barrel.

After falling $1.51 the previous session, U.S. West Texas Intermediate crude was trading at $90.58 per barrel, down 55 cents or 0.6%.

On Monday, the U.S. dollar increased for a fourth straight session as investors prepared for high inflation statistics to be reported this week, which could signal a continuation of the Federal Reserve’s aggressive monetary policy.

A strong dollar lowers the demand for oil by increasing the cost of purchasing it for consumers using other currencies.

According to Fed Vice Chair Lael Brainard, rate rises to this point were slowing the economy, but the full impact of tighter policy would not be felt for several months.

COVID- 19 instances rose to the highest number since August in China. China is the second-largest oil user in the world. Due to pandemic restrictions, its service activity declined in September for the first time in four months.

Since the beginning of October, thousands of cases brought on by the extremely contagious Omicron sub-variants BF.7 have been documented in Inner Mongolia, making it the most recent COVID epicenter in the nation.

The Organization of the Petroleum Exporting Countries and its allies, which includes Russia, collectively known as OPEC+, decided last week to decrease their output target by 2 million barrels per day in an effort to stem losses, which has increased worries about dwindling oil supplies.

The EU last week finalized a fresh set of sanctions on Russia, including a price cap on Russian oil exports, which will go into effect in December and February, respectively. EU penalties on Russian crude and oil products will also be implemented at those times.

According to Petroleum Minister Hardeep Singh Puri, India and Russia retain a “healthy interaction” and will consider any offers made in the wake of the project’s stated ownership restructuring.

Exxon Mobil’s 30% investment in the project can now be seized thanks to a directive that Russia released on Friday. Additionally, a Russian state-run corporation has been given the power to decide whether international investors, notably ONGC Videsh of India, can continue to invest in the project.

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