OIL FUTURES: Crude prices waver on growth outlook concerns

Crude oil prices fluctuated early Europe trading May 24 but still sat at the upper end of the range they have been in recent months amid continuing lockdowns in China and worries of a global recession.

At 11:58 am BST, ICE July Brent crude futures was down 40 cents/b on the day at $113.02/b, while NYMEX July WTI futures rose 33 cents/b to $110.62/b.

Global supply remains tight but China's COVID-19 lockdowns were curbing industrial and social activities in the region, relieving much of the pressure on demand.

Beijing registered record levels of infections leading to market talks that authorities might impose stricter restrictions on the city. A few investment banks, including UBS and Goldman Sachs, have downgraded China's 2022 growth outlook due to its zero COVID-19 policy.

Overall, the downside for crude prices was limited by tight global supply. The state of and threats to the global economy have been the main topics discussed at the World Economic Forum in Davos in the week started May 22.

Underinvestment in key oil and gas projects is concerning as the industry might struggle to guarantee energy supplies, according to Saudi Aramco Chief Executive Amin Nasser. The boss of the world's largest oil company warned of further imbalances if companies continue to be afraid of making investments under pressure from green energy, as the world is running with less than 2% of spare oil capacity.

In the EU, member countries were moving closer to an embargo on Russian imports of crude oil to the bloc, according to Germany's Economy Minister Robert Habeck.

"We will reach a breakthrough within days," he said, adding that "it is obviously an unusual measure, but these are unusual times."

The decision still faces strong opposition from countries heavily reliant on energy from Russia. Russia, whose seaborne oil exports remain at the same levels as before, itself indicated its intentions to shift oil trade flows toward Asia

The CBOE OVX index, an indicator of crude price volatility, was significantly down on the day at 48.63%.

In the foreign exchange market, the euro was stable against the dollar at $1.071.