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Crude oil futures closed lower on Tuesday as markets remain under pressure amid fears that a prolonged Chinese lockdowns could hurt the economy and oil demand. Oil futures were also pressured by the appreciation of the dollar.
- WTI crude futures fell $3.33, or 3.2%, at $99.76 a barrel.
- BRENT crude futures fell $3.48, or 3.28%, at $102.46 a barrel.
WTI crude futures fell from the $100 level as investors remained concerned that China’s ongoing Shanghai lockdown and partial Beijing lockdown would plunge the economy into recession and also slow oil demand.
An ING analyst said oil markets are under pressure as the European Union (EU) has yet to impose formal sanctions on Russian oil. European Commission (EC) President Ursula von der Leyen has called on EU members to suspend imports of Russian crude oil and refined oil products in response to the military’s incursion into Ukraine.
The dollar’s strength also made oil contracts more expensive for investors holding other currencies, as the dollar index rose 0.26% against the six major currencies in the currency basket to 103.9200.
Investors are waiting for the weekly U.S. crude oil inventories, which are to be published today by the EIA. While analysts expected that U.S. crude oil inventories will fall by 500,000 barrels.
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Wednesday, May 11, 2022