Crude oil prices totter over 2.5% as pandemic spread sours fuel demand outlook

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Crude oil prices totter over 2.5% as pandemic spread sours fuel demand outlook

On Monday, both US and UK crude oil prices pummelled more than 2.5 per cent, extending their latest leg of losing streak as a rapidly spreading Omicron variant, which now accounts for 73 per cent pandemic cases in the United States compared to a 3 per cent a week earlier, had raised possibilities of renewed restrictions as winter holidays near in Europe and the United States.

Adding further holocaust, Netherlands had announced a full lockdown measure during Christmas holidays, while Britain alongside a number of European nations were mulling an identical approach contemplating the speed at which Omicron cases were spreading.

Besides, stoking worries that fuel demands would likely to bottom over upcoming holiday season with global commodity market having poised for a crude surplus over Q1, 2022, WHO (World Health Organization) alongside several European nations had cautioned that the number of Omicron cases were doubling up in two to three days.

However, OPEC+ output remained well below its target in November, eventually paring some of the day’s havoc-scale losses. Nonetheless, a Moderna Inc statement released earlier in the day that said the American vaccine maker’s booster jab could raise antibody production up to 37-fold against Omicron variant, made little or no impacts.

Crude oil jolts as demand worries surge

Citing statistics, in the day’s commodity market wind-down, UK crude oil futures’ prices tumbled 2.7 per cent to $71.52 per barrel, while US WTI (West Texas Intermediate) crude oil futures’ prices faltered as much as 3.7 per cent to $68.23 per barrel.

UK crude fell more than 2.7 per cent last week, while US WTI crude oil contracts tumbled 1.3 per cent. Meanwhile, addressing to investors’ frets over potential lockdowns across a number of G20 economies, Houston-based Lipow Oil Associates’ Andrew Lipow said in a client note, “This is a knee-jerk reaction to the proliferation of the virus and the fear that lockdowns can rapidly spread”.