FX.co ★ Oil Prices Drift Lower On China COVID Concerns

Oil prices edged lower on Monday after rallying sharply in the previous session amid reports about China easing quarantine restrictions for inbound travelers and flights. Benchmark Brent crude futures slipped 0.3 percent to $95.73 a barrel, while WTI crude futures were down 0.4 percent at $88.58.

Oil prices edged higher earlier in the day on hopes that economic activity in China would recover due to efforts by policymakers to ease coronavirus restrictions.

An extensive package outlined by Chinese regulators to shore up financing in the embattled real estate also offered some support at open.

The early optimism faded as the dollar recovered on hawkish Fed comments and several Chinese cities, including Beijing, reported record COVID cases.

The U.S. dollar and bond yields rose after Fed Governor Christopher Waller pushed back on dovish rate bets saying that markets got "way out in front" over just one inflation print.

In China, the National Health Commission reported 16,072 new locally transmitted cases today, up from 14,761 on Sunday and the highest in the country since April 25.