West Texas Intermediate crude futures fell nearly 2% to close at $ 100 a barrel after weekly losses.
Shanghai recorded daily deaths from the virus over the weekend, while officials in Beijing warned of a quiet spread.
The world’s largest crude importer has been locked in Wuhan in the early days of the epidemic, and its worst oil demand this month has come as a shock.
The resurgence of the virus adds another volatility to the oil market affected by the Russian war in Ukraine.
The conflict has raised concerns about crude oil supplies and spurred inflation at a time when most economies are emerging from the worst of epidemics and boosting economic growth.
Following the Govt Zero strategy, China has implemented locks in several cities across the country.
Demand for petrol, diesel and jet fuel in April is expected to fall by 20% over the previous year, according to experts in the country’s energy sector.
This equates to a drop in crude oil consumption of 1.2 million barrels a day, they said.
Brent crude is still lagging behind – an elegant system where semi-dated contracts are more expensive than later contracts – but since the beginning of March it has shrunk significantly.
The spot time limit for the benchmark was 52 cents a barrel in the opposite direction, $ 4.64 on March 2.