Oil Extends Decline as Europe Eases Certain Russian Sanctions According to Bloomberg

Oil prices experienced their most significant decline in over five weeks as the European Union eased some of its proposed sanctions on Russian oil exports.

In early Asian trading, West Texas Intermediate futures dropped below $103 per barrel after a nearly 6% decline on Monday. The EU has decided to withdraw a suggested ban on EU-owned vessels transporting Russian crude, responding to objections from several member states, including Greece. Additionally, concerns surrounding economic growth, which have negatively impacted equity markets, have contributed to the bearish outlook for commodities.

Since Russia’s invasion of Ukraine in late February, the oil market has been in a state of volatility. The EU continues to deliberate on a sixth package of sanctions targeting the OPEC+ producer, with discussions ongoing to address Hungary’s opposition to a ban on Russian crude. Some diplomatic progress has reportedly been made, according to Hungary’s foreign minister after recent negotiations.

The situation has been further complicated by a resurgence of Covid-19 in China, which has introduced more volatility into the market. Lockdowns have placed pressure on the Chinese economy, and Premier Li Keqiang has emphasized a “complicated and grave” employment landscape as cities like Beijing and Shanghai implement stricter measures to manage outbreaks.