Oil prices dropped over 4% at Monday’s trading session amid reports that reveal the fast-spreading new COVID-19 strain has shut down much of the United Kingdom.
This has further led to tighter restrictions in Western Europe, thereby triggering fears among oil traders about a slower recovery in fuel demand.
What you should know
- At the time of writing this report, Brent crude plunged by over 4.75% to trade at $49.85 a barrel, after rising 1.5% to its highest since March on Friday.
- U.S. West Texas Intermediate (WTI) futures also dropped by 4.65% to trade at $46.88 a barrel, after gaining 1.5% on Friday to its highest since February.
Oil prices are drifting lower on the strong rebound seen in the U.S dollar index coupled with the new COVID-19 variant, which is reportedly much more transmissible than the original strain of COVID-19 virus, leading to a wider spread amid the rollout of COVID-19 vaccines, countries like Canada, Germany, Italy, Argentina, France, the Netherlands, Ireland, and Chile have banned travelers from going to the United Kingdom with some also banning freight from the United Kingdom.