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LONDON, Dec.22 (Reuters) – Oil prices were flat on Wednesday as fears of a tight supply were offset by concerns over COVID-19 after Singapore suspended travel without a quarantine and Australia renewed its vaccination campaign due to an increase in cases of Omicron variants.
US West Texas Intermediate (WTI) crude futures were unchanged at $ 71.12 a barrel at 1250 GMT after jumping 3.7% on Tuesday.
Brent crude futures fell 15 cents, or 0.20%, to $ 73.83 a barrel after gaining 3.4% in the last session.
“The bias is positive on optimistic updates from vaccine maker Moderna… but the rise appears limited as investors appear to be cautious about Omicron-related restrictions,” said Ajay Kedia, director of Kedia Commodities in Mumbai .
Moderna CEO Stéphane Bancel said on Tuesday that the vaccine maker did not expect any problems in developing a booster to protect against the Omicron variant and could start working in a few weeks. Read more
In another bullish indicator, industry data showed US crude inventories last week lower than expected.
Data from the American Petroleum Institute showed U.S. crude inventories fell 3.7 million barrels for the week ended Dec. 17, according to market sources, from an expected drop of 2.8 million barrels. by eight analysts polled by Reuters.
Weekly data from the US Energy Information Administration is due later Wednesday.
However, brakes on mobility across the world have once again fueled fears of declining demand for fuel.
Germany, Ireland, the Netherlands and South Korea are among the countries that have reimposed partial or full closures or other social distancing measures in recent days. Read more
The Singapore government has said it will freeze all new ticket sales for flights and buses from December 23 to January 20 in the city-state, citing Omicron’s risks.
On the supply side, investors are eagerly awaiting an OPEC + producer group meeting on January 4.
With production problems growing in Russia and various other countries in the Atlantic Basin, it is likely that producers in the Middle East could push for continued monthly quota increases, consultancy firm JBC Energy said in a note.
Reporting by Dmitry Zhdannikov, Mohi Narayan and Sonali Paul; edited by Himani Sarkar and Jason Neely
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