| 19 May 2024, Sunday |

Oil prices slide as Omicron variant clouds energy demand outlook

Concerns over the demand effect of the Omicron variant and stricter monetary policy caused oil to fall for the first price in three days.

Futures in New York fell below $72 per barrel after increasing 2.3 percent in the previous two days. Covid-Daily The number of cases in the United Kingdom has reached an all-time high of 19, while hospital admissions in the United States have skyrocketed. The Bank of England surprisingly hiked interest rates for the first time since the epidemic began, indicating that major central banks are now more concerned about inflation than the virus.

Markets are unclear as a result of a coordinated worldwide attempt to lower energy costs.
As Omicron impedes travel, signs of decreasing oil demand in Asia are developing, while the International Energy Agency said this week that the world market has reverted to excess. The market’s structure is revealing the weakness, with Brent briefly shifting into a bearish contango on Tuesday.

This week, traders were bombarded with contradictory signals on demand and supply, ranging from central bank initiatives and new limitations to curb the spread of Omicron to dropping US stockpiles. This has resulted in a generally risk-averse attitude in oil markets, with the aggregate volume of futures contracts dropping to its lowest level since August on Thursday.

“There is still a lot of ambiguity about Omicron,” Howie Lee, an economist with Oversea-Chinese Banking Corporation in Singapore, said. “Demand may be feeling the pinch in certain regions, but it does not appear to be as serious as the Delta epidemic at this time.” Price consolidation might last for a time.”

  • The National News