Oil trims losses

Oil prices pared losses after falling by over $2 earlier in the session, as a weaker dollar partially offset demand fears resulting from surging Covid-19 cases in China.

Brent futures for February were down $1.08, or 1.3 per cent, at $82.18 a barrel by 1439 GMT. The more active March contract shed 1.26 per cent to $82.93/bbl, after falling by over $2 earlier in the session.

US West Texas Intermediate crude futures fell $1.07, or 1.36 per cent, to $77.89 a barrel, after reaching session lows of $76.79.

The contracts pared losses as the US dollar slipped, with investors on edge at the end of the year as initial optimism over China's reopening fizzled.

A weaker dollar makes oil cheaper for holders of other currencies and can boost demand.

The scale of the latest Chinese Covid outbreak and doubts over official data prompted some countries to enact new travel rules on Chinese visitors, even as the world's largest crude oil importer began dismantling the world's strictest Covid regime of lockdowns and testing.