Oil prices increase slightly as Omicron worries ease

Oil prices rose slightly on Tuesday after rebounding by nearly 5% the day before. The news came after as the concerns about the Omicron variant’s influence on fuel demand eased. Also, Iran’s nuclear negotiations encountered obstacles that delayed the restoration of Iran’s crude oil supply.

Brent crude oil futures increased by 60 cents, or 0.8%, to $73.68 per barrel and closed up 4.6% on Monday. US West Texas Intermediate crude oil was at US$70.23 per barrel. It had an increase of 74 cents or 1.1% based on a 4.9% increase in the previous trading day.

Oil prices took a hard hit last week because the vaccine may be less effective on the new coronavirus variant Omicron. That has sparked concerns that governments may re-implement restrictions to curb its spread and global combat growth and oil demand.

However, a South African health official reported over the weekend that the Omicron cases there showed only mild symptoms.

An additional sign of confidence in oil demand is that Saudi Arabia, the world’s largest exporter, raised its monthly crude oil prices on Sunday.

Previously, OPEC+ agreed to continue to increase production by 400,000 barrels per day in January, even though the United States has released its strategic oil reserves.

In November, crude oil imports from China, the world’s largest importer, rebounded.

In addition, the delayed return of Iranian oil has supported prices. The indirect nuclear negotiations between the United States and Iran have encountered obstacles. Germany on Monday urged Iran to make realistic recommendations in talks on its nuclear program.

At the same time, Iraq is also optimistic about rising demand and prices. Meanwhile, global oil and gas executives warn that despite promoting clean energy, there is still insufficient investment and demand for fossil fuels.