Oil prices drop 3% as Omicron sweeps through Europe, North America

About 3% of oil prices fell on Monday as soaring Omicron Coronavirus cases in Europe and the United States prompted investor concerns that new regulations to combat its spread could harm fuel demand.

At the time of writing, Brent crude futures were down 2.6%, at $71.60 a barrel, while U.S. West Texas Intermediate (WTI) was down 3%, at $68.77 a barrel.

During today’s Asian trading session, the downward trend in oil prices corresponds to the downward trend in S&P 500 and Nasdaq 100 e-mini futures. This is due to fears of impending restrictions on economic activity because the COVID-19 Omicron variant is spreading worldwide, which may lead to a slowdown in demand.

Several European countries were preparing for COVID-19 restrictions ahead of the Christmas and New Year holidays when the Netherlands went into lockdown on Sunday.

READ ALSO: Goldman predicts oil price could hit $100 in 2022

As the Omicron variant raged across the world and is set to dominate the United States, U.S. health officials recommended that Americans get booster shots, wear masks, and exercise caution if they travel during the holiday season.

For the second week in a row, U.S. energy companies added oil and natural gas rigs.

According to Baker Hughes Co, the number of oil and gas drilling rigs rose by three in the week ending December 17, the highest level since April 2020, in its closely watched report on Friday.

Russia will still export fewer oil barrels in 2022 than in 2021, with exports and transit of oil slated for 56.05 million tonnes in the first quarter, according to a Reuters survey on Friday.

With state-backed refineries raising oil processing rates, China’s diesel exports in November plunged 69% from a year ago due to a fuel shortage caused by refineries prioritizing domestic supply.

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