Oil falls 8pc on Russia-Ukraine talk hopes, China lockdowns – World

Oil fell about 8% on Monday, dropping to its lowest level in two weeks. That’s because diplomatic efforts between Ukraine and Russia appeared to be able to end the conflict and increase global supplies, and oil prices fell to their lowest level in two weeks due to China’s pandemic-related travel ban. demand forecast.

Brent futures fell by $8.64 (7.7pc) per barrel at 10:59 a.m. EDT (1459 GMT) at $104.03. US West Texas Intermediate (WTI) crude fell 8.74 dollars, or 8.0%, to 100.59 dollars.

This puts both benchmarks at their lowest settling rates since February 28. Both surged after Russia’s February 24 invasion of Ukraine, and have increased by around 34% so far this year.

“In addition to the new talks between Ukraine and Russia, I think the new lockdown in China is the reason why crude oil prices start negative,” said Giovanni Staunovo, an analyst at bank UBS.

Brent and WTI posted their most volatile 30 days since June 2020. WTI experienced its most volatile month in April 2020, when prices turned negative, while Brent experienced its most volatile month in 1991 during the Persian Gulf War.

Ukraine said Monday it had begun “intense” talks with Russia on a ceasefire, immediate withdrawal of troops and security assurances in Kyiv, despite fatal shelling of residential buildings.

read: Talks resume as Russia presses Ukraine’s capital Kyiv

A rare travel ban has been put in place due to the Omicron outbreak in northeastern China.

“Investors understand the impact of sanctions on Russia and [a] “It’s a truce,” said Tina Teng, an analyst at financial services firm CMC Markets.

Russia’s oil and gas condensate production so far has risen to 11.12 million barrels per day (bpd) in March, two sources familiar with production data said. Reutersdespite sanctions.

The US has announced a ban on imports of Russian oil, and the UK has said it will phase it out by the end of 2022.

Russia is the world’s largest exporter of crude oil and petroleum products, shipping around 7 million barrels per day (7% of global supply).

A senior minister said British Prime Minister Boris Johnson was trying to persuade Saudi Arabia to increase production, while International Energy Agency (IEA) secretary-general Fatih Birol urged oil-producing countries to produce more.

India said it would take “proper” action, indicating that the country could release more oil from its national stockpile. Indian officials also said New Delhi is considering Russia’s offer to purchase crude oil and other commodities at discounted prices through a rupee-ruble deal.

An Iranian foreign ministry spokeswoman said the United States must make a decision to finalize an agreement to scrap Iran’s nuclear deal signed with Iran in 2015 with world powers amid concerns that some talks in Vienna could break down.

Analysts said the deal with Iran could add an additional 1 million barrels of oil to the market, but that would not be enough to offset the decline in Russia’s supply.

The US Federal Reserve is expected to start raising interest rates this week, which should boost the dollar. This could lower oil prices by making dollar-denominated oil more expensive for foreign currency holders.

Referring to a report from data provider Genscape, traders said crude stockpiles at Oklahoma’s Cushing storage hub increased last week for the first time this year. U.S. government data shows that stockpiles there have declined for the ninth straight week.