Oil Holds Gains Near $72 as Stockpiles Dip, Omicron Fears Abate - Bloomberg

Oil Holds Gains Near $72 as Stockpiles Dip, Omicron Fears Abate - Bloomberg

PRICES
West Texas Intermediate for January delivery rose 31 cents to settle at $72.36 a barrel in New York. Brent for February settlement gained 38 cents to settle at $75.82 a barrel.

Oil eked out a gain as research indicated that existing Covid-19 vaccines are effective against the new virus variant, quelling fears of plunge in fuel demand, while U.S. crude supplies fell slightly.

Futures in New York closed up 0.4%, trading near $72 a barrel, on Wednesday. Pfizer Inc. and BioNTech SE said initial lab studies show a third dose of their shots restores protection against the new variant. Meanwhile, domestic crude inventories fell 241,000 barrels last week, government data showed.

Crude prices have rebounded after falling into a bear market last week as nations began implementing lockdowns in response to the omicron variant, stoking concern about the impact to fuel demand. But so far, data show little sign of a significant hit to oil consumption, and OPEC+ has kept a floor under prices by keeping the door open to a possible reversal of its planned supply hike.

“Cautious optimism is prevailing that the hit from omicron on the global economy and thus energy demand will be less than initially feared,” said Stephen Brennock, an analyst at brokerage PVM Oil Associates Ltd.