Oil Slumps as Shanghai Shuts to Curb Covid Surge

March 28, 2022, 05.56 AM

ILUSTRASI. Shanghai's city government said on Sunday all firms and factories would suspend manufacturing or have people work remotely in a two-stage lockdown over nine days.

Source: Reuters | Editor: Wahyu T.Rahmawati

OIL PRICE - MELBOURNE. Oil prices fell more than $3 in early trade on Monday on prospects of a drop in fuel demand in China after authorities in Shanghai said they would shut the country's financial hub for a COVID-19 testing blitz over nine days.

Brent crude futures dropped as low as $116.18 and were trading down $2.75, or 2.3%, at $117.90 a barrel at 2215 GMT.

U.S. West Texas Intermediate (WTI) crude futures hit a low of $109.90 shortly after opening and were down $2.60, or 2.3%, at $111.30. Both benchmark contrasts had risen 1.4% on Friday.

Shanghai's city government said on Sunday all firms and factories would suspend manufacturing or have people work remotely in a two-stage lockdown over nine days, after the city reported a new daily record for asymptomatic COVID-19 infections.

Sapping fuel demand further, public transport, including ride-hailing services, will also be suspended during the lockdown.