Oil prices rose to above $78 per barrel Monday. This was due to tight supply and the hopes of a further demand recovery by 2022.
However, OPEC+ appears to be ready to agree to a further increase in output and concerns persist about the demand impact from rising coronavirus infections.
OPEC+ and its allies are expected to agree on Tuesday to the output increase. More than 4,000 flights were cancelled on Sunday due to Omicron coronavirus.
Brent crude oil rose 39 cents or 0.5% to $78.17 per barrel at 1444 GMT. It had previously risen as high of $79.05. U.S. West Texas Intermediate crude (WTI), fell 25 cents, or 0.3% to $74.96.
“Infection rates have risen globally, restrictions are being implemented in many countries, and the air travel sector is suffering, but investors’ optimism is tangible,” stated Tamas Varga, an oil broker PVM.
“In a nutshell 2021 proved that the war against coronavirus can be won, even though the road to victory is filled with unexpected twists.”
Many schools in the United States that normally welcome students back to school on Mondays are delaying their start dates. They are scrambling to test teachers and pupils, and may even resort to remote learning to deal with record COVID-19 numbers from the Omicron variety.
An outage in Libya gave oil some support. Due to pipeline maintenance, oil output will drop by 200,000 barrels per week for a week.
Brent rose by 50% last year due to the global recovery from the COVID-19 pandemic, OPEC+ supply cut cuts and record-breaking infections.
Some people see greater gains in 20222.
According to UBS analysts, Giovanni Staunovo, “Crude and oil products prices will benefit from higher oil demand levels in 2019,” said Giovanni Staunovo. “We anticipate Brent to reach $80-90 in 2022.”
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