Oil Prices Dip Amid Scare Of New COVID-19 Strain

The new strain of the virulent COVID-19 virus discovered in United Kingdom and now in other countries has begun to take a toll on crude oil as hopes of prices rebound become bleak.

Oil prices took a dip on Tuesday as almost 2 percent slump in prices was recorded, eroding the slight rise in prices occasioned by roll-out and administration of vaccines.

Brent crude suffered 72 cents decline at 1.4 percent to $50.19 a barrel in early morning trading while the West Texas Intermediate (WTI) crude shed 76 cents at 1.6 percent to $47.21.

Both benchmark contracted by nearly 3 percent on Monday.

Ekohotblog had reported how the UK government  raised alarm over a new variant of the virus, which it said was more deadly and virulent than previous types and seemed to be spreading much faster.

READ ALSO: COVID-19 Vaccine: Oil Prices Rebound To Highest Since March

Many countries, including India, Pakistan, Russia, Jordan and Hong Kong have joined European countries in imposing flight restrictions on UK. Some countries in the Middle East have also closed their border.

This dip in oil prices could portend unpleasant outcomes for Nigeria with crude oil as mainstay of the country’s economy and from which government generate half of its government’s revenue and about 90 percent of foreign exchange earnings.

The proposed 2021 budget is benchmarked at $40 per barrel.