Oil closes with falls in trade shaken by Covid-19 restrictions in China

Los oil prices They fell on Monday, paring gains after rising to more than two-month highs, amid mixed signals about tight Covid-19 restrictions in China, the world’s top crude importer.

crude oil futures Brent They fell 36 cents to $98.21 a barrel by 18:20 GMT. Earlier in the session, they rose to a session high of $99.56 a barrel, the highest level since August 31.

US WTI fell 36 cents to $92.25. It earlier rose 74 cents to a session high of $93.74 a barrel, the highest level since Aug. 30.

Prices rose during the session on news that Chinese leaders are considering reopening the economy from tight Covid-19 restrictions, but are moving slowly and have not set a timetable, the Wall Street Journal reported, citing sources.

The market seems to be thinking that if China opens up the economy, that would significantly reduce supply and put further upward pressure on prices,” said Phil Flynn, an analyst at Price Futures Group.

However, weighing in on futures, Chinese health officials over the weekend reiterated their commitment to strict Covid containment measures.

Meanwhile, China’s imports and exports unexpectedly contracted in October, but its oil purchases rebounded to the highest level since May.

Adding some price support, the dollar sank against the euro on Monday and the British pound was supported by risk-off sentiment and a rally in European stock markets. A weak dollar makes dollar-denominated oil less expensive for other currency holders, helping drive prices higher.

Oil prices have also been supported by tighter supply expectations when The European Union embargo begins on December 5 on Russia’s seaborne crude oil exports, even though refiners around the world are ramping up production.