Oil prices edged higher on Monday as supply disruptions in Kazakhstan and Libya offset concerns over a rapid rise in Omicron infections worldwide.
Brent crude was up 24 cents, or 0.3%, at $81.99 a barrel by 0730 GMT, while U.S. West Texas Intermediate (WTI) crude gained 22 cents, or 0.3%, to $79.12.
Oil prices rose 5% last week after protests in Kazakhstan disrupted train lines and hit production at the country’s top oil field, Tengiz.
Tengizchevroil (TCO), Kazakhstan’s largest oil company, is gradually ramping up output to meet average numbers. Protests curbed production at the Tengiz field recently, operator Chevron (CVX.N) said on Sunday.
A Russian Invasion of Ukraine Could Disrupt Russian Crude Exports to Europe and Push up Prices
Eight years after Russia seized the Crimean peninsula from Ukraine, tens of thousands of Russian troops have gathered within the border with Ukraine to prepare for what Washington and Kyiv say is a possible invasion.
Oil was also supported by rising global demand from the Organization of the Petroleum Exporting Countries, Russia and its allies, or OPEC+, and a lower-than-expected increase in supply.
OPEC’s December output rose by 70,000 BPD from the previous month. Meanwhile, the increase allowed under the OPEC+ supply agreement was a 253,000 BPD. It restored output cut in 2020 when demand collapsed under the COVID-19 lockdown.
After a two-year decline, U.S. energy companies kicked off the new year by adding oil and gas rigs in 2021.
Governments from Europe to China and India have imposed restrictions for a highly circulating variant of the Omicron coronavirus.
In the U.S, job growth fell short of expectations in December due to worker shortages. Job gains are likely to remain modest in the near term as a spiral of COVID-19 infections disrupts economic activity. The market is waiting for OPEC’s next move.