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Oil was down on Monday morning in Asia, falling to near two-week lows and continuing the previous week’s losses.
Prolonged COVID-19 lockdowns in Shanghai and potential U.S. interest rate hikes also continue to drive fuel demand concerns.
Brent oil futures fell 2.81% to $103.17 by 1:18 AM ET (5:18 AM GMT) after hitting $103.41, its lowest level since Apr. 12, earlier in the session.
WTI futures slid 2.79% to $99.22, after falling to $98.93, the lowest since Apr. 12, earlier. Both Brent and WTI benchmarks lost nearly 5% during the previous week.
"Oil is rerating lower due to the China consumption hit while the U.S. Federal Reserve is raising interest rates to slow down the US economy," SPI Asset Management Managing Director Stephen Innes said in a note.
"Those are two gusty headwinds suggesting some oil bulls will give way to recession fears and demand devastation."
Fed Chairman Jerome Powell signaled that a half-point interest rate increase "will be on the table" when the Fed hands down its policy decision in May 2022.
Meanwhile, in China, fuel demand concerns remain even as Shanghai slowly eases its lockdown.
On the supply side, U.S. energy firms added oil and natural gas rigs for a fifth consecutive week.
Across the Atlantic, the Russia-Kazakh Caspian Pipeline Consortium resumed full exports from Apr. 22 after almost 30 days of disruptions following repairs on one of its key loading facilities, three sources told Reuters.
The ongoing war in Ukraine, precipitated by the Russian invasion on Feb. 24, could also raise pressure on the European Union (EU) to sanction Russian oil and increase prices later in 2022.
"Oil prices are not expected to fall below $90 a barrel due to the prospect of a potential ban by the EU on Russian oil amid a deepening Ukraine crisis," Nissan (OTC:NSANY) Securities general manager of research Hiroyuki Kikukawa told Reuters.
The bloc is preparing "smart sanctions" against Russian oil imports, The Times quoted European Commission executive vice president Valdis Dombrovskis as saying.
Russia is Europe's top gas supplier and is also the second-biggest oil exporter globally after Saudi Arabia.
Emmanuel Macron's victory in the French presidential election on Sunday could also give the black liquid a boost, according to some investors.
"I would expect London to buy oil as he has been a highly vocal supporter of the European Union oil embargo," said the note from SPI's Innes.
