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LONDON: Oil prices dropped by more than $5 on Monday as fears over weaker fuel demand in China grew after financial hub Shanghai lockdown efforts to curb a surge in COVID-19 infections.
Shanghai has entered a two-stage lockdown of 26 million people on Monday in an attempt to curb the further spread of the coronavirus.
Brent crude futures slid as low as $115.32 a barrel and were trading down $4.53, or 3.7%, at $116.12.
US West Texas Intermediate (WTI) crude futures hit a low of $108.28 a barrel, and were down $4.55, or 3.9%, at $109.35.
Both benchmark contracts rose 1.4% on Friday, notching their first weekly gains in three weeks, with Brent surging 11.8% and WTI climbing 8.8%.
Hopes for reconciliation from peace negotiations between Russia and Ukraine, which could start in Turkey on Tuesday according to the Kremlin, also weighed on prices.
Oil demand in China, the largest crude importer globally, is expected to be 800,000 barrels per day (bpd) softer in April compared with “normal” levels, as a result.