Oil prices fell to their lowest since the start of the year on Monday, weighed down by the prospect of sluggish demand, particularly after a death linked to COVID-19 in China which dampens hopes of easing of measures. restriction.
At the end of the afternoon, in Paris, the European benchmark, Brent for January delivery, lost 5.48% to US$82.84, while American WTI for December delivery fell 5.66% to 75 US$.55, with fears of recession around the world exacerbating these concerns.
China announced on Sunday its first death from COVID-19 since May, an 87-year-old man in Beijing, where the rise in the number of cases is gradually leading to the closure of establishments and businesses.
China being the world’s largest importer of crude, “concerns about demand have moderated the rise in prices since the start of the year (…) whereas in June, the increase was 50%”, comments Richard Hunter, analyst at Interactive Investor.
Brent is still up nearly 7% from the Dec. 31 close, but WTI is nearly level.
A sign that the drop in demand is beginning to have concrete effects, “oil reserves at sea (with crude stored on carriers, editor’s note) are at their highest since May 2020, which could translate into an increase in terrestrial reserves,” notes Giovanni Staunovo, an analyst at UBS.
Goldman Sachs analysts have revised their price forecast for the end of the year to US$100 a barrel of Brent, a drop of US$10.
Those of UBS estimate that reserves “should decrease at the end of the year with the drop in production of OPEC+, the limitation of Russian exports and the end of the use of American strategic reserves”.
It remains to be seen how OPEC+ will react to lower prices. The alliance will meet in Vienna in early December.