US oil prices move lower, ending 3-session gain streak

Oil futures stabilized lower on Thursday as the benchmark U.S. crude ended a three-session streak of gains that had lifted prices to a two-week high a day earlier.

Restrictions recently imposed in parts of the world to combat the omicron variant of the coronavirus have been blamed for putting some pressure on energy demand and crude oil prices. British Prime Minister Boris Johnson on Wednesday recommended remote working where possible and urged the wearing of masks in public places.

Countries like Denmark and China have also imposed some level of mobility restrictions to limit the spread of contagion.

A Japanese scientist discovered that the omicron variant is 4.2 times more transmissible in its early stages than the delta variant, according to a Bloomberg report.

Despite news that the variant may not be as destructive to oil demand as initially feared, “more countries around the world are reintroducing restrictions and other measures to curb oil production. ‘increase in the number of cases,’ said Louise Dickson, senior oil markets analyst at Rystad Energy, in a daily market commentary. . This raises “fears that the world market is still negatively affected and, therefore, causes a bearish environment for oil prices.”

The measures are imposed even as a report Wednesday from Pfizer PFE,
and BioNTech SE BNTX,
the results of an “initial lab study” showed their COVID-19 vaccine neutralized the omicron variant of the coronavirus after three doses, or the full two-dose regimen plus a booster.

West Texas Intermediate crude for delivery in January CLF22,

fell $ 1.42, or 2%, to $ 70.94 on the New York Mercantile Exchange, after rising 0.4% on Wednesday to end at the highest level since Nov. 24 for a contract most active, scoring a third consecutive daily gain.

February Brent gross BRNG22,

fell $ 1.40, or nearly 1.9%, to close at $ 74.42 a barrel on ICE Futures Europe. This follows a 0.5% increase in the global benchmark in the previous session, which helped it record its fifth consecutive gain and its best result since November 25. Thursday’s loss marked the first session decline for Brent since Dec. 1, according to Dow Jones. Market data.

Meanwhile, reports on US oil stocks were also still being analyzed as investors weighed concerns about the virus against supply and demand fundamentals.

The Energy Information Administration reported that US crude inventories fell 200,000 barrels for the week ended December 3. That marked a second weekly drop, but it was a smaller drop than the 1.2 million barrel drop estimated by an analyst polled by S&P Global Platts. .

EIA data also has show U.S. Strategic Petroleum Reserve inventories declined 1.7 million barrels to 600.9 million barrels last week, while total domestic oil inventories rose 100,000 barrels to 11, 7 million barrels per day. Crude inventories at the Cushing, Oklahoma, Nymex delivery center edged up 2.4 million barrels for the week.

In other Nymex transactions, petroleum product prices ended up falling, with January RBF22 gasoline,
down 0.9% to $ 2.128 per gallon and January HOF22 heating oil,
lose 0.5% to $ 2.25 per gallon.

Natural gas futures rose briefly, then changed little, after the EIA on Thursday reported a third consecutive weekly decline in U.S. supplies of the product, down 59 billion cubic feet for the week ended 3 December. This compared to the average. 55 billion cubic feet fall predicted by analysts polled by S&P Global Platts.

January NGF22 natural gas,
came in at $ 3.814 per million British thermal units, down a fraction of a cent for the session, after rising 2.9% on Wednesday.

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Felix J. Dixon