Thursday, January 27

Oil fell because omicron spread clouded the outlook for demand

“This is a knee-jerk reaction to the proliferation of the virus and the fear that lockdowns will spread rapidly,” said Andrew Lipow of Lipow Oil Associates.

The Netherlands entered a quarantine on Sunday and the possibility of further COVID-19 restrictions being imposed ahead of the Christmas and New Year holidays loomed over several European countries.

US health authorities on Sunday urged Americans to get vaccinated against COVID-19, wear masks, and be careful when traveling during winter break, as omicron is wreaking havoc on the world and is destined to become the dominant strain.

Oil prices fell despite Moderna Inc. announcing that a booster dose of its COVID-19 vaccine appeared to protect against omicron in laboratory tests.

Meanwhile, OPEC + compliance with oil production cuts stood at 117% in November, one percentage point more than the previous month, they told Reuters two sources in the group, as production continues to fall short of agreed targets.

In the United States, energy companies added oil and natural gas platforms for the second week in a row.