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Oil prices fell to near their lowest levels this year

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NEW YORK: Oil prices fell to near their lowest levels this year on Monday as street protests against strict Covid-19 curbs in China, the world’s biggest crude importer, stoked concern about the outlook for fuel demand.

Brent crude dropped $2.66, or 3.1%, to trade at $80.97 a barrel at 1000 GMT, after diving more than 3% to $80.61 earlier in the session – its lowest since Jan 4.

US West Texas Intermediate (WTI) crude slid $2.39, or 3.1%, to $73.89 a barrel. It fell as far as $73.60 earlier, its lowest since Dec 22, 2021.

Both benchmarks, which hit 10-month lows last week, have posted three consecutive weekly declines.

Markets appeared volatile ahead of an Opec+ meeting this weekend and a looming G7 price cap on Russian oil.

The Organization of the Petroleum Exporting Countries (Opec) and its allies including Russia, known as Opec+, will meet on December 4. In October, OPEC+ agreed to reduce its output target by 2 million barrels per day through 2023.

Meanwhile, Group of Seven (G7) and European Union diplomats have been discussing a price cap on Russian oil of between $65 and $70 a barrel, with the aim of limiting revenue to fund Moscow’s military offensive in Ukraine without disrupting global oil markets.

But EU governments were split on the level at which to cap Russian oil prices, with the impact being potentially muted.

The price cap is due to come into effect on Dec 5 when an EU ban on Russian crude also takes effect. — Reuters

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