29-11-2021
Oil prices rose on Monday as investors searched for bargains after Friday's slide and on speculation that the OPEC+ rally may stop oil production increases amid the spread of the Omicron strain of coronavirus, but the mood remains cautious with little to no knowledge of the new variable.
Prices jumped more than four percent, compensating for some losses after falling by more than ten percent in the previous session. On Friday, oil prices recorded their largest drop in a single day since April 2020 after the new strain raised fears among investors and increased fears that oversupply could increase in the first quarter.
Brent crude futures rose $3.17, or 4.4 percent, to $75.89 a barrel by 0748 GMT, after falling $9.50 on Friday.
US West Texas Intermediate crude rose $3.35, or 4.9 percent, to $71.50 a barrel, after falling $10.24 in the previous session.
There is concern that the new strain will impede the recovery path of the global economy, which may weaken demand for oil, while fears of an oversupply in the first quarter of next year have also increased.
The Omicron strain spread around the world on Sunday, with the Netherlands, Denmark and Australia reporting new cases even as more countries have imposed travel restrictions.
The OPEC+ gathering of expert-level meetings has been postponed until later this week, giving its members, namely OPEC countries and independent producers led by Russia, more time to assess the impact of Omicron on oil demand and prices, according to sources and documents of the bloc.
The meeting of the OPEC Joint Ministerial Monitoring Committee was postponed from Tuesday to Thursday. OPEC + will also meet on Thursday, when a policy decision for the bloc is likely to be announced on whether to adjust its plan to increase production by 400,000 barrels per day in January and beyond.
Meanwhile, talks on reviving the 2015 Iran nuclear deal are set to resume in Vienna on Monday, as Iran's nuclear progress raised doubts about a possible breakthrough to bring Tehran and the United States back into full compliance with the deal.
(Reuters)