The oil market is declining at the beginning of a new trading week

At the beginning of the trading week, the oil market fell to its lowest level in almost a week under pressure from news about inflation in the United States and concerns about a decrease in oil demand in China.

If on Friday Brent oil was trading above $124 per barrel, today the asset has fallen to a minimum in a few days – $119.36. 

Pressure on prices was exerted by news about new cases of coronavirus in China. Investors fear that the increase in morbidity may lead to the introduction of new restrictions on movement, which have only recently begun to be lifted. And since China is the largest oil exporter, the demand for raw materials in this case will significantly decrease. 

This news overshadowed even the current problems in Libya, where the civil war over the past couple of weeks has led to the cessation of production of more than 1 million barrels of oil per day.

An additional negative impact on oil prices was provided by the statistics on inflation in the United States, which showed an increase in consumer prices by 8.6% in May. It is worth noting that over the weekend, gasoline prices in the United States for the first time in history exceeded $5 per gallon on average in the country.