A drop in oil accelerated on Monday, sending prices around their 2.5-month low as traders fear new restrictions aimed at slowing the spread of the Delta variant will weaken the global economy and reduce demand. fuel.
U.S. crude fell 4.6% and recently fell 2.5% to $ 66.59 a barrel, near its lowest price since late May and about 11% below a recent multi-year high of mid-July. While prices are still well above the $ 50 level where they started the year, their multi-month rise has turned into a reversal as cases of the Delta variant soar and governments respond. .
Investors are particularly concerned about falling demand in China, where Beijing health officials said last week the city would cancel all large-scale exhibitions and events for the remainder of August. Similar moves in the world’s largest commodity consumer risk blocking a recent rebound in travel, worrying traders as China’s economic recovery had already shown signs of slowing in recent months.
Merchants are also weighing a wave of delays in return-to-office plans for U.S.-based businesses from Amazon.com Inc. to Wells Fargo & Co., fueling fears that stay-at-home trends have taken hold. resulting in months of price volatility could set in again.
“Anxiety continues to grow over the destruction of demand,” said Donald Morton, senior vice president at Herbert J. Sims & Co. which oversees an energy trading office. “We are seeing many liquidations.