Oil Prices Rise As Omicron Covid-19 Variant Concern Softens

Oil Prices Rise As Omicron Covid-19 Variant Concern Softens

Oil pricesrose slightly in London on Tuesday, after regaining about 5% the day before, as concerns about the Omicron variant’s influence on global fuel consumption faded amid stalled Iranian nuclear talks.

iexclusive News Nigeria reports that Brent crude futures were up 0.5 percent to $73.42 a barrel early Tuesday morning, after finishing 4.6 percent higher on Monday. Following a 4.9 percent gain the previous session, US West Texas Intermediate crude was up 0.6 percent at $69.92 a barrel.

Last week, oil prices plummeted on fears that vaccines against the Omicron Coronavirus variety would be ineffective, prompting predictions that countries will re-impose restrictions to halt the virus’s spread and undermine global growth.

However, Omicron instances in South Africa exhibited very minor symptoms during the weekend. “It does not appear to be serious so far,” Anthony Fauci, a top infectious disease official in the United States, told CNN.

Oil markets have been pricing in the worst-case scenario for the past few weeks.

Saudi Arabia, the world’s biggest oil supplier, boosted monthly crude prices on Sunday, signaling renewed confidence in the market for the commodity.

Despite the release of US strategic petroleum reserves, the Organization of Petroleum Exporting Countries and its partners, known as OPEC+, agreed to expand output by 400,000 barrels per day in January.

A delay in the return of Iranian oil aided prices as well. The indirect nuclear talks between the US and Iran have hit some stumbling hurdles.

Germany encouraged Iran to offer serious suggestions in negotiations over its nuclear program on Monday.

There is a potential that negotiations will succeed when they restart later this week, but markets may have to prepare for a prolonged delay in Iranian oil deliveries.

Similarly, Iraq has voiced confidence about price increases and demand, but global oil executives have bemoaned underinvestment and the need for fossil fuels, despite efforts to shift to cleaner energy sources.