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Oil slumps on China travel curbs, strong U.S. dollar

Reuters2021-08-09

MELBOURNE, Aug 9 (Reuters) - Oil prices dropped 2% on Monday, extending last week's steep losses on the back of a rising U.S. dollar and concerns that new pandemic curbs in Asia, especially China, may set back the global recovery in fuel demand.

Brent crude futures slid $1.41, or 2%, to $69.29 a barrel by 0125 GMT, after having slumped 6% last week, their biggest weekly loss in four months.

U.S. West Texas Intermediate $(WTI)$ crude futures fell $1.32, or 1.9%, to $66.96 a barrel, after having slumped nearly 7% last week in their steepest weekly decline in nine months.

"Concerns about potential global oil demand erosion have resurfaced with the acceleration of the Delta variant infection rate," RBC analyst Gordon Ramsay said in a note.

ANZ analysts pointed to new restrictions in China, the world's second largest oil consumer, as a major factor clouding the outlook for demand growth.

The curbs include flight cancellations, warnings by 46 cities against travel, and limits on public transport and taxi services in 144 of the worst hit areas.

On Monday, China reported 125 new COVID-19 cases, up from 96 a day earlier.

"While the number of cases (in China) is low, it comes just as the summer travel season peaks," ANZ commodity analysts said in a note. "This has overshadowed signs of strong demand elsewhere."

In Malaysia and Thailand, infections continue to hit daily records of more than 20,000.

Oil also fell as the U.S. dollar rallied to a four-month high against the euro after Friday's stronger-than-expected U.S. jobs report spurred bets that the Federal Reserve may move more quickly to tighten U.S. monetary policy.

A stronger U.S. dollar makes oil more expensive for holders of other currencies.

Trading was quiet with holidays in Japan and Singapore.

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  • Happygolucky
    ·2021-08-09
    ?
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  • OO_898
    ·2021-08-09
    Like 
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  • henghm
    ·2021-08-09
    Like and comment
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    • AgnL
      sure
      2021-08-09
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  • Pluto891
    ·2021-08-09
    will it rise back? yes.. OPEC will moderate the production again.. 
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    • Geoz88
      everything drop
      2021-08-09
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  • Roycethong
    ·2021-08-09
    Oil price fluctuations is always a norm
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  • Philipoo
    ·2021-08-09
    Pls like. Thanks
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  • Tiongsquare
    ·2021-08-09
    Pls like 
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    • hal
      Ok
      2021-08-09
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    • Stchua
      Done
      2021-08-09
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  • Tiongsquare
    ·2021-08-09
    Pls like 
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  • bran1711
    ·2021-08-09
    Interesting read!
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  • bran1711
    ·2021-08-09
    Great article! 
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  • Simplewind
    ·2021-08-09
    Pls like.  Thanks
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  • Soksok
    ·2021-08-09
    Like 
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  • edgetrader
    ·2021-08-09
    BTC is stronger
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    • Kelvin_Qiu
      [捂脸] missed the boat by selling off too earlier
      2021-08-09
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  • WKB
    ·2021-08-09
    The demand will come back after COVID-19
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  • xiaobaii
    ·2021-08-09
    Like & Comment, Thank You Very Much 
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  • beebeeyan
    ·2021-08-09
    ok
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    • xiaobaii
      Like & Comment, Thank You Very Much
      2021-08-09
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