Oil at new multi-year highs
These worries have also weighed on equity markets
HONG KONG (Reuters) - Asian shares dropped on Wednesday, reversing early gains, as analysts said sky-high oil prices meant stocks were quick to react to any hint of bad news such as a rate hike by New Zealand’s central bank.
Oil steadied at multi-year highs having been pushed there by concerns about energy supply, and a decision on Monday by the OPEC+ group of producers to stick to a planned output increase rather than raising it further.
U.S. crude rose to its highest level since 2014 but pared gains and was last off 0.15% to $78.81 a barrel. Brent crude lost 0.07% to $82.46 per barrel, having hit a three-year high in the previous session.
"OPEC’s outlook suggests further reductions in global oil stockpiles. That’s a problem given that oil inventories are already low," wrote analysts at CBA in a note.
These worries have also weighed on equity markets, concerned that higher energy prices could force central banks to raise rates more quickly to react to rising inflation.
