LAST UPDATE: 11.45
Oil prices are recovering at the beginning of the week, offsetting some of the losses after Friday’s slump that reached -13% with traders worried that the new mutation could derail the global economic recovery, affecting oil demand. The possibility of inflating the supply surplus in 2022 with the release of stocks from large -consumer- countries also raises concerns.
Thus, after the worst day for the oil market since April 2020 on Friday, today “we see some correction, as the dip at the end of last week was excessive,” said Tatsufumi Okoshi, senior economist at Nomura Securities.
“If prices fall further, OPEC + may halt the planned increase in crude production to support prices,” he said.
In particular, the West Texas Intermediate adds $ 3.07 or 4.5% to $ 71.22 a barrel. The Brent oil moves up $ 3.41 or 4.7% to $ 76.13 a barrel. On Friday, the WTI had fallen by 13.1% and Brent had lost 11.6%.
OPEC + postponed its technical meetings to later in the week, trying to save time and better assess the potential impact of the new Omicron mutation on oil demand.
The OPEC + Joint Ministerial Monitoring Committee has been moved to Thursday, where the Agency will meet on the same day and is expected to announce its decision on whether to adjust its plan to increase production by 400,000 barrels per day from January onwards.
Some analysts have suggested that the cartel could halt production growth following the release of stocks from oil-rich countries and the potential impact on demand from possible new lockdowns around the world to curb the new mutation.
Russia: No need for hasty decisions
Russia sees no need for urgent action in the oil market over new coroner Omicron, Deputy Prime Minister Alexander Novak said today, downplaying the possibility of changes to the global oil deal.
“We have to watch closely. There is no need for hasty decisions,” Novak was quoted as saying by Interfax news agency.
Novak said that OPEC + countries have not asked for a renegotiation of the current agreement in response to Omicron, according to news agencies.
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