NEW DELHI: Brent Crude price fell below $100 on Tuesday as fresh COVID-19 curbs in China, the world’s biggest crude importer, and fears of a global economic slowdown weighed on the fuel demand outlook. Brent Crude Futures, a major benchmark for oil price worldwide, 7.1%, at $99.48 a barrel by 11:04 a.m. ET, while the US West Texas Intermediate crude fell 7.3% to $96.42.
“Oil prices fell sharply on Tuesday on a strong dollar, demand-sapping COVID-19 curbs in top crude importer China and fears of a global economic slowdown. Dollar demand and fear of low energy demand due to a new variant of covid-19 in China put pressure on crude oil prices. We are expecting Brent crude may test $98 levels and WTI may test $92 per barrel levels very soon,” said Anuj Gupta, VP Research, IIFL Securities.
The oil price skirted the global market for various reasons including recession fears in recent weeks as a combination of inflation and rising interest rates thrashes the US economy. The biggest crude importer, China, has imposed lockdown restrictions in its six cities to curb the Covid-19 infection from spreading, and oil is paying the price for it as restrictions tear away at demand. On the supply side, Russia curtailing gas to parts of Europe, it’s wiped out a sense of optimism about the economic outlook.