Oil slips on demand concerns

Oil prices slid for a fourth day on concerns over new COVID-19 restrictions imposed in China, the world's largest oil importer. Tightened restrictions may have an impact on fuel demand.

As reported by Reuters, Brent crude oil prices slipped more than 6% this week. WTI oil fell more than 7%. 

Guangzhou, an important manufacturing center of China with a population of 19 million people, reported over 2,000 new COVID cases for November 9. The number of cases has exceeded that level for a third day now amid the city's most serious outbreak. On Wednesday, authorities issued guidelines for citizens that included testing for COVID-19. One district was locked up as cases in China historically rose since April 30. 

The decline in oil prices was also caused by fuel inventories data in the U.S. revealed on Wednesday. According to the report, crude oil inventories rose significantly. SPI Asset Management managing partner Stephen Innes said that this was just the tip of the iceberg, as China’s slowing economy and disease outbreak weigh on oil markets.

According to Commonwealth Bank analyst Vivek Dhar, bearish sentiment around rising U.S. crude inventories may have been exaggerated.

Dhar expects the price of Brent crude to average about $95 a barrel in the fourth quarter. The oil market will tighten amid an EU ban on seaborne imports of Russian crude oil on December 5.