Oil weighed down by fears of recession

(London) Oil prices were down slightly on Monday amid concerns about a slowing global economy, although black gold supplies remain closely watched in a tight market.

Posted at 8:32

Around 5:20 a.m., a barrel of Brent from the North Sea, for delivery in September, lost 0.76% to 110.78 dollars.

The barrel of American West Texas Intermediate (WTI), for delivery in August, fell 0.87% to 107.49 dollars.

“Ongoing recession fears could cap the price of oil,” commented Russ Mould, analyst at AJ Bell, although “fundamentally supply remains tight.”

Meanwhile, China has placed 1.7 million people in lockdown in eastern Anhui province, where some 300 new cases of COVID-19 were reported on Monday as part of a new upsurge in the virus. epidemic in certain regions.

The country is taking a firm approach to the virus, with major screening campaigns, mandatory quarantines and lockdowns as soon as a few cases appear.

“Despite the possible drop in demand due to China’s announcement, supply remains tight, exacerbated by possible blackouts in Libya and production stoppages in Norway,” said Richard Hunter, analyst at Interactive Investor.

Since the start of the year, the price of Brent has risen by more than 40% and that of WTI by more than 41%.

In Norway, a strike by workers in the energy sector is expected to lead to the closure of three new hydrocarbon fields. According to the Norwegian Oil and Gas Association, this will result in a daily loss of oil production of 130,000 barrels.

In Libya, the Libyan National Oil Company (NOC) announced Thursday evening losses of more than 3.5 billion dollars resulting from the forced closure of major oil sites since mid-April, and decreed the state of “force majeure on certain installations.

The country is endowed with the most abundant reserves in Africa. Plunged into chaos since the fall of the Gaddafi regime, Libya is struggling to emerge from the institutional crisis.

Oil production in Ecuador has also fallen recently as the country has been rocked by protests over high living costs and fuel prices.

“This context of growing supply disruptions comes up against a possible shortage of spare production capacity among Middle Eastern oil producers,” said Stephen Brennock, analyst at PVM Energy.

The relief should not come from the Organization of the Petroleum Exporting Countries and their partners (OPEC +), which renewed Thursday their objective of opening the valves slightly more important for this summer.


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