The international oil benchmark, Brent crude, fell on Thursday for the fifth straight day to its lowest in two weeks on growing worries about rising COVID-19 cases in Europe and strengthening of the dollar that hurts the value of oil.
Brent, against which Nigeria’s oil is priced, tumbled by 6.21 per cent or $4.22 to $63.78 per barrel as of 7:39pm Nigerian time on Thursday.
That puts Brent on track for its lowest close since March 3, and it would be the longest losing streak for Brent since September 2020, according to Reuters.
“Crude prices are declining for a fifth consecutive day as concerns grow that Europe won’t have a regular summer,” said Edward Moya, senior market analyst at OANDA in New York.
“Europe is seeing a third straight week of rising COVID-19 cases and with vaccination hurdles remaining in place,” he added.
Reuters reported that a slowdown in vaccination programmes in Europe and the prospect of more restrictions to control the coronavirus had tempered expectations for a recovery in fuel use.
It said Britain would have to slow its COVID-19 vaccine rollout next month due to a supply crunch caused by delays in shipments of millions of AstraZeneca shots from India and the need to test the stability of an additional 1.7 million doses.
A number of European countries have halted use of the AstraZeneca shot because of concerns about possible side effects, though the World Health Organisation said Europe should continue to use the vaccine.
US crude inventories rose for the fourth straight week after severe cold weather in Texas and the central part of the country in February forced shutdowns at refineries.
A rise in the value of the dollar after the US Federal Reserve meeting has also contributed to the oil sell-off. A stronger dollar makes oil more expensive for holders of other currencies.