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In
volatile trading, Brent crude futures for May fell $2.07, or
2.8%, to $70.90 a barrel at 0950 GMT. The U.S. West Texas
Intermediate crude contract for April was down $1.88, or 2.8%,
at $64.86 before its expiry on Tuesday.
The more actively traded May futures were down 2.8% at $65.06 a
barrel.
Brent and WTI earlier hit lows last registered in December 2021,
with WTI sinking below $65 a barrel. Both benchmarks shed more
than 10% of their value last week as the banking crisis
deepened.
The slide in oil comes despite the historic deal for UBS,
Switzerland's largest bank, to buy Credit Suisse in an attempt
to rescue the country's second-biggest bank.
However, banking stocks and bonds continued to plunge on Monday
in a sign that investor confidence remains fragile.
After the deal was announced, The U.S. Federal Reserve, European
Central Bank and other major central banks pledged to enhance
market liquidity and support other banks.
"The market focus is on current banking sector volatility and
the potential for further rate hikes by the Fed," said Baden
Moore, National Australia Bank's head of commodity research.
The U.S. Federal Reserve is expected to raise interest rates by
25 basis points on March 22 despite the recent banking sector
turmoil, according to most of the economists polled by Reuters.
However, some executives are calling on the central bank to
pause its monetary policy tightening for now but be ready to
resume raising rates later.
"Volatility is likely to linger this week, with broader
financial market concerns likely to remain at the forefront,"
ING Bank analysts said in a note, adding that the looming Fed
decision increases week's Fed meeting adds to uncertainty in
markets.
Further out, a ministerial committee of OPEC and producer allies
including Russia, together known as OPEC+, is set for April 3.
The group agreed in October to cut oil production targets by 2
million barrels per day until the end of 2023.
(Reporting by Noah BrowningAdditional reporting by Florence Tan
and Emily Chow in SingaporeEditing by David Goodman)
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