The New York futures exchange was closed on Friday, while London futures slipped towards $76 a barrel in very light holiday trading. “If the news is confirmed that omicron is not as dangerous as earlier variants, that could end up being quite bullish for oil next year,” said the head of commodities research at Bank of America. “There’s a risk oil spikes next year.” Crude is heading for a yearly gain, but the rally has faltered, in part due to concerns about omicron. Nevertheless, there are some signs of tightening emerging, with supply disruptions in Libya and Nigeria.
Futures posted a weekly decline after a few volatile days that saw traders grow more concerned about the demand impact from the omicron variant and tighter monetary policy. New York futures fell 3.4% on Friday to close at $70.85 after briefly trading below $70 a barrel. Brent closed the week at $73.52. Daily Covid-19 cases in the UK jumped to a record, while hospitalizations surged across the US. Prices also weakened after the US dollar rose in response to impending steps by the Federal Reserve and other central banks to tame inflation.
Futures saw their biggest weekly gain in more than three months as the worst fears over the new virus strain have receded. Brent and WTI posted gains of about 8% this week, their first weekly gain in seven, even after a brief bout of profit-taking. Brent futures settled at $75.15 a barrel, after falling 1.9% on Thursday. WTI rose 73 cents, to $71.67 after sliding 2% in a volatile session the previous day.
Crude prices ended little changed on Friday after erasing earlier gains on growing worries that rising coronavirus cases and a new variant could reduce global oil demand. Earlier in the day, oil prices climbed more than $2 a barrel after OPEC+ said it could review its policy to hike output if a rising number of pandemic lockdowns chokes off demand. Brent futures settled at $69.88 a barrel, while West Texas Intermediate ended at $66.26. Both benchmarks declined for a sixth week in a row for the first time since November 2018.