Oil Prices Steady as Omicron Caution Lingers

By Reuters
December 22, 2021 Updated: December 22, 2021

LONDON—Oil prices were steady on Wednesday as fears of tight supply were offset by COVID-19 concerns after Singapore suspended quarantine-free travel and Australia renewed its vaccination push due to a surge in Omicron variant cases.

U.S. West Texas Intermediate (WTI) crude futures were unchanged at $71.12 a barrel at 1250 GMT after jumping 3.7 percent on Tuesday.

Brent crude futures fell 15 cents, or 0.20 percent, to $73.83 a barrel after gaining 3.4 percent in the last session.

Industry data also showed that U.S. crude inventories last week registered a larger-than-expected decline.

American Petroleum Institute data showed U.S. crude stocks fell 3.7 million barrels for the week ended Dec. 17, according to market sources, versus a 2.8 million barrel drop that eight analysts polled by Reuters had expected.

Weekly data from the U.S. Energy Information Administration is due later on Wednesday.

However, mobility curbs across the globe once again stoked fears of a drop in fuel demand.

Germany, Ireland, the Netherlands, and South Korea are among countries that have reimposed partial or full lockdowns or other social distancing measures in recent days.

On the supply side, investors are looking ahead to a meeting of the OPEC+ producers group on Jan. 4.

With the growing production issues in Russia and various others in the Atlantic Basin, it is likely that Middle Eastern producers could push for a continuation of monthly quota increases, consultancy JBC Energy said in a note.

By Dmitry Zhdannikov