Oil is falling near its lowest level in 2022, under pressure from economic concerns

Oil futures witnessed little change in Asian trading on Wednesday, December 7th, as fears about the impact of the cap imposed by the West on the price of Russian oil were offset by hopes for an improvement in demand from China, which kept the markets in anticipation after a sharp decline in prices in the previous session.

Brent crude futures rose slightly by three cents, or 0.04%, to $79.38 a barrel, after falling below $80 for the second time in 2022 during the previous trading session.

US crude futures rose and fell during trading, and fell nine cents, or 0.12%, to $74.16 a barrel.

Yesterday, Tuesday, the decline of Brent crude was the largest in one day since late September, and the Brent trading range, that is, the difference between the highest and lowest price, this year, reached $ 62.

And expectations of high Chinese demand continued to give a positive impetus to the markets, with the country announcing a decrease in new infections in Corona for the second day in a row, in addition to comprehensive changes in its strict policy to combat the virus.

And ANZ said in a note to a client that the return of Chinese economic activities to operate at full capacity may increase global oil demand by 1%.

Data on Wednesday showed that China’s crude oil imports rose 12% year-on-year in November to their highest level in 10 months, as companies fill their inventories with cheaper oil as new plants start operating.

Data from the American Petroleum Institute, which shows a potential drawdown in US crude inventories by about 6.4 million barrels, also supported the supply sentiment.

However, uncertainty about the impact of imposing a cap on the price of Russian oil contributed to the volatility in the market. The Vedomosti newspaper reported today, Wednesday, that Russia is studying 3 options, including banning oil sales to some countries and setting a maximum discount at which it sells its crude to meet the price ceiling imposed by Western powers.

Oil prices fell by more than 1% for three consecutive sessions, erasing most of their gains for the year.