The unfortunate tanker mishap in the Suez Canal that continues to block tanker traffic is being overshadowed by another wave of coronavirus-inspired lockdowns, sending oil prices once again downward.
Oil prices slipped roughly 4% on Thursday afternoon, with WTI crude trading down $2.80 per barrel at $58.88-down 4.58% on the day.
Brent crude was trading down $2.48 per barrel at $61.93-a slide of 3.85% on the day.
Weighing heavily on oil prices are the third wave of coronavirus lockdowns in Europe. Experts suggest that Poland is in the throes of its worst point in the pandemic, reporting a record number of cases. As a result of the increase in infections, Poland has just announced a strict two-week lockdown that will close nursery schools and salons and reduce church capacity.
The Polish Prime Minister Mateusz Morawiecki said that Poland was "one step away from crossing the border beyond which we will not be able to properly heal our citizens."
Additional lockdown measures in France went into effect on Saturday, and the government has threatened to implement tougher measures still.
Germany had imposed a strict five-day lockdown over the Easter holiday but has since rethought that strategy, which has angered its citizens.
The lockdowns will stifle oil demand in Europe, and the market is more concerned with this aspect than with the vessel that has lodged itself in the Suez Canal, creating a traffic jam that includes oil tankers, which is tightening short-term supplies.
Add to these two events OPEC's meet that is coming up on April 1. Although it is expected that OPEC will hold oil its production steady for the most part considering the volatile nature that still exists in the market, the uncertain nature of the meeting has put traders on edge as they watch for signs that would give clues to OPEC's strategy as the group tries to keep the market in balance and prices at optimum levels.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More