Oil prices fell on Thursday, extending losses from the previous session, as fears of supply disruption eased on news that the Group of Seven (G7) nations were considering a high price cap on Russian oil.
Brent crude futures had slid 43 cents, or 0.5%, to $84.98 a barrel by 0102 GMT, while U.S. West Texas Intermediate crude futures dropped 35 cents, or 0.5%, to $77.59 a barrel.
Both benchmark contracts plunged more than 3% on Wednesday on news that the planned price cap could be above the current market level. The G7 is looking at a cap on Russian seaborne oil in the range of $65-70/bbl, according to a European official, though European Union governments have not yet agreed with each other on the matter.The range of $65‑70/bbl would be higher than markets had expected, Commonwealth Bank commodities analyst Vivek Dhar said in a report. It would reduce the risk of global supply being disrupted, Dhar said.
"If the EU agree to an oil price cap of $65‑70/bbl this week, we see downside risks to our oil price forecast of $95/bbl this quarter," Dhar said, adding that the forecast assumed EU sanctions accompanied by a price cap on Russian oil would disrupt enough supply to offset ongoing global growth concerns.
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