Oil prices fell along with stocks on Monday, weighed down by a strong dollar and demand concerns due to prolonged coronavirus lockdowns in China, the world’s top oil importer.
At 11:11 GMT, the Brent lost $2.32, or 2.13%, to $119.99 a barrel, while the West Texas Intermediate in the United States (WTI) fell $2.64, or 2.41%, to $107.16 a barrel. Both contracts have gained more than 40% so far this year.
The dollar hit a new two-decade high, making it more expensive a barrel for holders of other currencies.
Global financial markets have been hit by concerns about interest rate hikes and recession, as tightening and widening of Covid-19 lockdowns in China led to lower export growth in the world’s second-largest economy in April.
In Russia, oil production rose in early May from April, stabilizing, according to Deputy Prime Minister Alexander Novak, after falling in April as a result of Western sanctions imposed over the Ukraine crisis.
Chinese crude imports were down 4.8% in the first quarter compared to a year ago, but included a nearly 7% rise in April.
On the supply side, Saudi Arabia, the world’s leading oil exporter, lowered oil prices for Asia and Europe in June.
Last week, the European Comission proposed a gradual embargo on Russian oil, which boosted Brent and WTI prices for the second week in a row. However, the proposal requires a unanimous vote among bloc members this week, which has not yet occurred.