OP: Oil prices plunge as China locks down Shenzen

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OilPrice.com reports:

– Oil fell back below $110 on a surge in COVID cases across China.

– China locked down all 17.5 million residents in the business hub Shenzhen.

– Hope of progress in peace talks in the Ukraine war also offset bullish developments for crude oil.

Oil prices fell below the $110 per barrel mark early on Monday after China locked down several cities because of a surge in COVID cases and Russia and Ukraine separately signaled progress in talks that continue today.

As of 7:30 a.m. EDT on Monday, WTI Crude was down 5.75% at $103.12 and Brent Crude was falling by 4.92% to $107.13.

After largely remaining on the sidelines of the newsflow over the past month, COVID again returned to make headlines in China, where it originated. China locked down all 17.5 million residents in the business hub Shenzhen and limited bus services to Shanghai after COVID cases spiked over the past few days.  

“This will raise concern over the potential hit to demand. But also importantly, it suggests that China is not ready to let go of its zero-covid policy,” ING strategists Warren Patterson and Wenyu Yao said on Monday.

The full story can be read here.