China COVID19 lockdowns hurt nearterm demand
EU set to finalise further Russia sanctions
Coming up API supply report, 2030 GMT

LONDON, May 3 Reuters Oil slipped about 1 on Tuesday as concerns about the demand outlook due to prolonged COVID lockdowns in China outweighed support from a possible European oil embargo on Russia over its actions in Ukraine.

Beijing, reporting dozens of new cases daily, is masstesting residents to avert a lockdown similar to Shanghai39;s over the past month. The capital39;s restaurants were closed for dining in, and some apartment blocks were sealed shut. 

Brent crude was down 1.30, or 1.2, at 106.28 a barrel at 0942 GMT. U.S. West Texas Intermediate WTI crude dropped 90 cents, or 0.9, to 104.27.

The positive driver has been the EU embargo and whether that will be announced, said Commonwealth Bank commodities analyst Vivek Dhar.

Your negative driver is Chinese COVID lockdowns. They39;re both very important thematics.

Oil has hit multiyear highs this year, with Brent reaching 139 in March, the highest since 2008, after Moscow39;s invasion of Ukraine exacerbated supply concerns that were already fuelling a rally.

The increasing prospect of EU sanctions on Russia lent support. The European Commission is expected to finalise on Tuesday work on the next package of EU sanctions against Russia, which would include a ban on buying Russian oil. 

A potential EUwide oil embargo could significantly undermine the already diminishing…