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Oil prices are at their lowest level in two months

Economie

Oil prices are at their lowest level in two months

Oil prices neared a two-month low on Monday, as concerns about supply eased while worries about fuel demand in China and rising interest rates overshadowed prices.

Brent crude futures for January delivery fell 74 cents, or 0.8 percent, to $86.88 a barrel by 0715 GMT.

US West Texas Intermediate crude futures for December delivery, Seventy, were $9.40 a barrel, down 68 cents, or 0.9 percent, before the contract expired later on Monday. January contracts fell 59 cents, or 0.7 percent, to Seventy at $9.52 a barrel.

Both benchmarks closed Friday at their lowest since Sept. 27, extending losses for a second week, with Brent down 9 percent and WTI down 10 percent.

Europe’s meager crude supplies fell as refiners stockpiled ahead of the European Union’s ban on Russian crude taking effect on December 5, putting pressure on physical crude markets across Europe, Africa and America.

The European Union’s energy policy chief told Reuters that the EU expects to complete its regulations in time to implement the G7 plan to cap the price of Russian crude on December 5.

Diesel markets remained tight, with Europe and the United States competing for supplies. While China doubled its diesel exports in October from the previous year to 1.06 million tons, the volume was much lower than September’s exports of 1.73 million tons.

Fuel demand for the world’s largest crude importer remains weak due to restrictions imposed by China to combat Covid-19, while expectations of further interest rate hikes in other countries have led to a rally in the dollar, making dollar-denominated commodities more expensive for investors.

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