Oil falls on vaccine efficacy worries; WTI down over 6% | Reuters

Oil falls on vaccine efficacy worries; WTI down over 6% | Reuters

Oil prices tumbled on Tuesday, with U.S. crude futures falling by more than 6%, after Moderna's chief cast doubt on the efficacy of COVID-19 vaccines against the Omicron coronavirus variant, spooking financial markets and heightening worries about oil demand.

The head of drugmaker Moderna Inc (MRNA.O) told the Financial Times that COVID-19 vaccines are unlikely to be as effective against the Omicron variant of the coronavirus as they have been against the Delta variant. read more

Brent crude futures fell $2.95, or 4%, to $70.49 a barrel by 12:12 p.m. EST (1712 GMT), after hitting an intraday low of $70.22, their lowest since August.

U.S. West Texas Intermediate (WTI) crude futures fell $4.30, or 6.2%, to $65.65 a barrel. The benchmark dropped to a session low of $65.23, also its lowest since August.

"The threat to oil demand is genuine," said Louise Dickson, senior oil markets analyst at Rystad Energy. "Another wave of lockdowns could result in up to 3 million bpd (barrels per day) of oil demand lost in the first quarter of 2022 as governments prioritize health safety over reopening plans, of which there is already telltale evidence, from Australia delaying its reopening to Japan banning foreign visitors."