NEW YORK: Oil prices fell on Friday and were also down in the week as rising cases of the Omicron coronavirus version raised fears that new restrictions could hit fuel demand.
“There are concerns about Covid that won’t go away, and the perception that it could weigh on demand is putting pressure on the market,” said Bob Yeager, director of energy futures in Mizuho, New York.
Brent crude futures fell $1.50, or 2%, to $73.52 a barrel, while US West Texas Intermediate (WTI) crude fell $1.52, or 2.1%, to $70.86 a barrel. Brent was down 2.6% and WTI 1.3% in the week.
New cases of omicron are doubling every two days in Denmark, South Africa and the UK. Danish Prime Minister Mette Fredriksen said on Friday that her government would propose new restrictions to limit the spread.
In the United States, the rapid proliferation of the Omicron version has prompted some companies to shelve the plans. -2021-12-16 To bring the employees back to the offices.
Vandana Hari, energy analyst at Wanda Insights, said, “The warnings of caution and a worsening COVID wave have started ringing louder with the year-end holiday season weakening market sentiment.” “Crude oil may remain in a holding pattern.” However, in holiday-thin trading over the next few weeks, with prices fluctuating significantly around the average.”
The Organization of the Petroleum Exporting Countries, Russia and allies, known as OPEC+, have said they could meet ahead of their scheduled January 4 meeting if a change in demand outlook is expected to add 400,000 barrels per day of supply. Their plans require review. January.
“We may see further consolidation around $70 in the coming sessions as we learn more about OMiron, what sanctions it will bring, and whether OPEC+ will react,” said Craig Erlam, senior market analyst at OANDA.
The US oil rig count, a key indicator of production, rose in the week, raising concerns of a potential oversupply. The oil and gas rig count, an early indicator of future production, rose by 579 in week three to December 17, energy services firm Baker Hughes Co said in its closely-followed report on Friday. [RIG/U]
But despite Omicron’s threats to demand, Goldman Sachs said on Friday that the new version has limited impact on dynamics or oil demand, adding that oil consumption is expected to hit record highs in 2022 and 2023. .
Oil prices retreated from multi-year highs in the fourth quarter on improved supply.
(Additional reporting by Sonali Paul in Melbourne, Roslan Khasavaneh in Singapore and Noah Browning in London; Editing by Edmund Blair, Elaine Hardcastle and Leslie Adler)
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