Oil Prices Rose Thanks to Comments About the Omicron

Oil prices benefited from positive comments regarding the Omicron variant. Even as some governments stepped up curbs to stop its rapid spread, prices rose.

According to Pfizer and BioNTech, a three-shot course of their Covid-19 vaccine may protect against infection from the Omicron variant.

On Thursday, U.S. West Texas Intermediate (WTI) crude futures gained 52 cents or 0.7% to $72.88 a barrel. One day earlier, WTI crude futures advanced 0.4%.

Brent crude futures added 40 cents or 0.52% to $76.22 a barrel, adding to a similar gain on Wednesday.

Importantly, it is likely to face resistance around the lower end of the $76.50-$77.50 range, a key support level in late September and late November.

Still, market gains were muted as governments reintroduced restrictions to limit the spread of Omicron. On Wednesday, British Prime Minister Boris Johnson announced tighter restrictions to limit the spread of the Omicron variant. He said it was time to introduce stricter restrictions to prevent a spike in hospitalizations and deaths.

Denmark decided to close restaurants, bars, as well as schools. South Korea is also struggling to reduce the number of new cases.

Oil prices and Covid’s new variant

The Omicron variant had a tremendous impact on the Brent prices. From November 25 to December 1, Brent prices dropped 16%. Investors are trying to digest various information about oil prices.

The Omicron variant is not the only issue. The situation regarding Iran is another major challenge. Analysts expect U.S. and Israeli defense chiefs to discuss possible military exercises on Thursday. Such activities would prepare for a worst-case scenario. Israel is willing to destroy Iran’s nuclear facilities.

Winter storms in southern Russia were hampering oil operations in Black Sea ports, delaying cargoes as well as increasing costs.