Oil Slumps on Covid-19 Delta Variant Worries, Strong Dollar
Oil futures were down BY almost 4% on Monday due to growing concerns over a slowdown in global demand following the rapid spread of the delta variant of COVID-19, and a strong United States dollar.
Market sentiment gauge shows that investors are concerned about the rising COVID-19 infections globally, which affect mobility as some nations started imposing travel restrictions, again.
Today, authorities in the Chinese capital have tightened travel restrictions to the city, banning visitors from coronavirus hotspots as they try to keep the highly transmissible Delta variant at bay.
Beijing is a top travel destination during the summer holidays, putting it at risk of spread from elsewhere.
As a result, city authorities have banned travellers from areas with recent cases and suspended plane, train and long-haul bus services from those centres.
The curbs imposed by Chinese authorities also include flight cancellations, warnings by 46 cities against travel, and limits on public transport and taxi services in 144 of the worst-hit areas.
Last week, the Beijing municipal committee of the Communist Party said anyone from Beijing who was in a high-risk province would not be able to return until they had completed 14 days of health monitoring and a negative coronavirus test 48 hours before boarding a flight or train.
Those returning to Beijing from other infected areas would also have to undergo a further 14 days of quarantine and a series of coronavirus tests.
In Japan, authorities in the country are planning to further expand emergency measures, while daily infection rates in the US have reached 100,000 cases a day, the highest in six months.
In Malaysia and Thailand, infections continue to hit daily records of more than 20,000.
Oil prices were also affected by the strong US dollar, which reached the highest level in four months 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.
West Texas Intermediate oil futures for September delivery on the New York Mercantile Exchange were down 4.07% at $65.41 a barrel in morning trading, while Brent crude for October delivery on the Intercontinental Exchange gained 3.76% to $68.03 per barrel.
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Oil Slumps on Covid-19 Delta Variant Worries, Strong Dollar
