Oil Futures Settle Modestly Higher

Crude oil futures settled modestly higher on Wednesday, recovering well after having drifted lower earlier in the day amid concerns about the outlook for energy demand due to a surge in the Omicron variant of the coronavirus.

The Federal Reserve, which announced that it would speed up its reduction of monthly bond purchases, also signaled three interest-rate hikes next year.

Data released by Energy Information Administration (EIA) earlier in the day showed crude inventories in the U.S. dropped by 4.6 million barrels in the week ended December 10.

The EIA data also said gasoline stockpiles were down by nearly 720,000 barrels last week, while distillate stocks fell by 2.85 million barrels in the week.

West Texas Intermediate crude oil futures for January ended up by $0.14 or about 0.2% at $70.87 a barrel, off the day’s low of $69.39 a barrel.

Brent crude futures were up $0.30 or 0.41% at $74.00 a barrel a little while ago.

Oil prices drifted lower earlier in the day, weighed down by virus worries after the World Health Organization Chief told reporters that 77 countries have reported cases of Omicron and the variant of coronavirus is spreading at an unprecedented rate.

The International Energy Agency (IEA) has stated in its latest oil market report that the virus is set to slow demand recovery in the coming weeks.

With new travel restrictions going into effect in several countries, the IEA revised down slightly—by 100,000 barrels per day (bpd)—its demand growth forecast for both this year and next.

Source: Read Full Article