Renewed lockdowns send oil prices tumbling

Oil prices nosedived Tuesday on lower demand prospects as Europe's biggest economy Germany said it would reimpose strict coronavirus containment measures and struggles along with other EU nations to roll out vaccines.

European stocks ended the day mostly lower while US stocks drifted down ahead of speeches by Fed chief Jerome Powell and Treasury Secretary Janet Yellen.

On currency markets, the Turkish lira stabilised a day after plunging in reaction to news that President Recep Tayyip Erdogan sacked the country's market-friendly central bank chief, raising concerns about another round of financial turbulence.

Germany will meanwhile enter a strict shutdown for five days over Easter amid surging virus rates, Chancellor Angela Merkel and regional leaders agreed Tuesday.

Neighbouring France should be vaccinating "morning, noon and evening", President Emmanuel Macron said as he tackles criticism that the Covid-19 immunisation drive has been too slow.

France is facing a third wave of infections but is lagging behind many Western countries in terms of the number of people vaccinated.

"Oil has tumbled today over growing concerns about European demand as tighter restrictions in countries is likely to be a setback in regards to reopening their economies," said market analyst David Madden at CMC Markets UK. 

He noted that little over two weeks ago crude struck 14-month highs as OPEC and its allies decided keep most of their production cuts in place.

"Now it seems that several large economies in Europe might not experience economic lift-off for a few more months, so dealers have been dumping oil as a result," he said.

Stocks prices of oil companies and airlines which could see the crucial summer travel season hurt in Europe suffered.

Across the Atlantic, the focus was on the first joint congressional testimony by Federal Reserve boss Jerome Powell and Treasury Secretary Janet Yellen, who were due Tuesday to answer questions on their policy response to the pandemic.

This comes as markets are rattled by a sharp rise in US Treasury yields in recent weeks, fuelled by bets that the forecast strong bounce in economic activity this year will fan inflation and force the bank to lift interest rates before 2024, as it has previously indicated.

The pair have repeatedly said they do not see the spike in inflation lasting and will maintain ultra-loose monetary policies -- including record-low rates -- until they have a grip on unemployment, and price rises are above two percent for an extended period.