The price of Brent crude has lost 30 per cent since it peaked above US$139 per barrel a week ago, falling below US$100 on Tuesday.
Though analysts, traders and investors forecast the possibility of the commodity surging to $200, Brent crude shed seven per cent of its value.
“I wouldn’t rule out $200 a barrel just yet,” a CNN Business report quotes Bjørnar Tonhaugen, head of oil markets at Rystad Energy. “It’s too soon.”
Russia’s invasion of the Ukraine and associated sanctions against the former had sparked fears of low supplies globally, stoking price increases in the last few weeks. However, diplomatic talks between the two countries have tempered fears of a future oil shortage.
Added to this, China — the world’s largest consumer of crude, importing about 11 million barrels of oil per day — has placed the tech hub of Shenzhen under lockdown and implemented new rules in Shanghai as it seeks to contain another outbreak of COVID-19.
“…Demand from China could drop due to new coronavirus restrictions in major cities. This would ease the squeeze on the market,” the CNN Business article outlined.
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