FX.co ★ Oil Pares Early Gains, Settles Notably Lower On Demand Concerns

Crude oil prices pared early gains and drifted lower on Tuesday amid concerns about the outlook for energy demand due to a surge in coronavirus cases in China.

According to reports, lockdown has been extended in Shanghai, where asymptomatic coronavirus cases rose by a record 13,086 on Monday, up from 8,581 cases a day earlier.

Oil prices climbed higher earlier in the day, extending gains from the previous session amid rising concerns over tighter global supply as the European Union and the United States are reportedly mulling further sanctions against Russia.

West Texas Intermediate Crude oil futures for May ended down by $1.32 or about 1.3% at $101.96 a barrel, after having climbed above $105.00 a barrel earlier in the day.

Brent crude futures were down $1.59 or 1.48% at $105.94 a barrel a little while ago.

U.S. President Joe Biden called Russian President Vladimir Putin a war criminal and sought additional sanctions on Russia.

The U.S. is likely to announce new sanctions on Russia this week. Meanwhile, the 27-member EU is under pressure to extend sanctions to Russia's oil and coal sectors to condemn its war crimes in Ukraine.

Traders looked ahead to weekly inventory reports from the American Petroleum Institute (API) and U.S. Energy Information Administration (EIA), due later today, and Wednesday morning, respectively.