Oil prices fall significantly at the start of the week

The oil market is under pressure, crude oil fell significantly on Monday. In particular, the struggle for an oil embargo pushed down prices.

Oil prices came under significant pressure on Monday. An embargo by the European Union against Russian oil imports has become less likely. In the late afternoon, a barrel (159 liters) of the North Sea variety Brent cost $ 107.48. That was $4.91 less than on Friday. The price of a barrel of the US West Texas Intermediate (WTI) variety fell by $ 5.26 to $ 104.60.

Hungary wants to veto the planned embargo of the EU against Russian oil imports. “Hungary will not vote for this package (in the EU Council), because the Hungarian people must not pay the price for the war (in Ukraine),” Foreign Minister Peter Szijjarto told the Budapest parliament on Monday. In order for the sanctions package to be implemented, all countries must agree.

Oil markets had previously barely reacted to the news that the G7 countries had agreed on a gradual ban on imports of Russian crude oil. “Most of the G7 countries had already taken this step anyway,” explained Carsten Fritsch, commodity expert at Commerzbank.

China’s No-Covid Policy Puts Oil Market under Pressure

Fritsch, meanwhile, referred to the decision of Saudi Arabia. The major oil producing country lowered its official sales prices for Asia over the weekend.

The burden on the oil market comes mainly from China, as the People’s Republic continues to take particularly strict action against the spread of the coronavirus. Week-long curfews in megacities are putting a considerable strain on the domestic economy. China is the second largest economy in the world and one of the largest oil consumers.