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Oil price closes down at US $ 102.32 due to confinements in China due to the outbreak of COVID-19

The price of a barrel of Brent oil for delivery in June continued its downward trend on Monday and closed with a significant drop of 3.94%, down to US$ 102.32 per barrel.

North Sea crude, a benchmark in Europe, ended the day on the International Exchange Futures down US$4.2 compared to the last trade, when it closed at US$106.52.

The resurgence of the COVID-19 pandemic in China will generate limitations in the demand for oil, since the Asian country is the main importer of crude oil, experts said.

The lower economic activity in China caused by the new confinements has been joined at the beginning of this week by increasingly clear signs that point to a rate hike by the Federal Reserve and the continued fall in demand.

Specialists also link this eventual rise in rates with a strengthening of the dollar, the currency with which oil is traded.

The tightening of ‘covid zero’ restrictions in Shanghai and fears that omicron (variant) has spread through Beijing have torpedoed market sentiment today, driving prices down again in Asian trades”, commented the analyst Jeffrey Halley, of the firm Oanda.

Investors fear that the Chinese measures will cause the demand for crude oil to fall again, as happened at the beginning of the pandemic, which today pulled down prices that have risen sharply in recent months and, above all, since the start of the pandemic. the Russian invasion of Ukraine.

*With information from EFE

Source: Elcomercio

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