Crude oil edges higher as Omicron fear wanes

December 09, 2021 02:11 PM AEDT | By Arpit Verma

Crude oil edges higher as Omicron fear wanes — Image source: © Tebnad | Megapixl.com

Recovery in crude oil prices

The global crude oil benchmark Brent has recovered by nearly 10% since 1 December on expectations that the new variant of coronavirus will have a limited effect on oil demand. Studies also suggest that a third shot of the Pfizer-BioNTech vaccine may improve the protection against Omicron.

During the last week, the prices of crude oil tumbled significantly on concerns that vaccines would be less effective on the new variant of coronavirus.

As per the US weekly figures, crude oil stocks dropped by 240,000 barrels while distillates and gasoline stocks rose as refiners increased the production

Oil demand and supply

Source: © Pricelessphotos | Megapixl.com

Apart from this, the market expects that the supply will supersede demand in early 2022 due to an increase in US production and Middle East supply additions.

Furthermore, the US and Iran have resumed talks over reviving the 2015 Iran nuclear program that may further add to the oil supply.

Bottom Line

Crude oil prices rose on Wednesday in hopes that the new variant of coronavirus is not so severe and an update from Pfizer-BioNTech that the third shot of vaccine may improve the protection against Omicron.

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