This archive report was first published on 18 December 2021.
Oil prices plummeted on Friday, December 17, 2021, as concerns over the Omicron coronavirus variant continued to grow. The variant's rapid spread in countries like Denmark, South Africa, and Britain has led to fears of new restrictions that could hit fuel demand.
According to Bob Yawger, director of energy futures at Mizuho in New York, 'There are concerns about Covid-19 that won’t go away, and the perception that could weigh on demand is putting pressure on the market.'
As a result, Brent crude futures settled down $1.50 (Sh129.95), or two per cent, at $73.52 (Sh8,307) a barrel, while US West Texas Intermediate (WTI) crude dropped $1.52 (Sh171.76), or 2.1 per cent, to settle at $70.86 (Sh8,007) a barrel.
The Organisation of the Petroleum Exporting Countries, Russia, and allies, known as OPEC+, have said they could meet before their scheduled January 4 meeting if changes in the demand outlook warrant a review of their plans to add 400,000 barrels per day of supply in January.
Meanwhile, Goldman Sachs has stated that the new variant has had limited impact on mobility or oil demand, and expects oil consumption to hit record highs in 2022 and 2023.
