2 Factors Causing Global Oil Prices Fall to 102 USD Per Barrel
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10 May 2022 11:37 WIB
TEMPO.CO, Jakarta - Global oil prices fell in early Asian trading on Tuesday, May 10, and added to the 6 percent decline in the previous session. The weakening of commodity prices was triggered, among other things, by the lockdown in China, which is the world's main oil importer.
The decline in world oil prices was also affected by the potential economic disruption in Europe, which in turn triggered concerns about the prospects for demand for these energy commodities.
Brent crude was down 36 cents, or 0.3 percent, at US$105.58 per barrel at 0009 GMT. US West Texas Intermediate crude fell 23 cents, or 0.2 percent, to $102.86 per barrel. The benchmark oil price was down more than earlier in the session but pared its losses. Both contracts are still up about 35 percent so far this year.
Financial markets are paying attention to concerns that further curbing Russian oil imports due to the country's invasion of Ukraine could present economic problems for some European countries.
Last week, the European Commission proposed a gradual embargo on Russian oil. The plan pushed both Brent and WTI prices up for the second week in a row. Although the proposal still needs a unanimous vote by EU members this week to pass.
Suspended Russian gas supplies to Germany would also trigger a deep recession and cost half a million jobs. That was stated by a senior economist in an interview published on Tuesday, Antaranews reported.
Reuters reports that state officials are secretly preparing for a sudden halt to Russian gas supplies with an emergency package that could include controlling key companies.
Hungary has also restated its position that it will not accept the proposed new round of sanctions against Russia until its concerns are addressed.
Read: Oil Prices Drop as U.S. Announces Massive Crude Reserve Release
ANTARA | REUTERS
