Crude oil contracts closed down more than 13% yesterday (November 26). The cause was pressure from concerns about the discovery of a new COVID variant in South Africa.
- WTI crude futures fell $10.24, or 13.1%, at $68.15 a barrel. That’s a drop of more than 10.4% this week.
- BRENT crude futures fell $9.53, or 11.59%, at $72.72 a barrel. That’s a drop of more than 8% this week.
Both crude oil futures posted their biggest daily losses since April 2020, closing the market at their lowest levels.
This decline is due to the discovery of a new COVID variant called B.1.1.529, a variant for which it is not yet possible to determine to what extent the built-up immunity can help. Investors are concerned that a renewed spread of the new variant could cause many countries to announce a new round of lockdowns, which could affect the economy and oil demand.
Yesterday, the United States announced that it will impose travel restrictions on eight African countries.
Meanwhile, the United Kingdom announced that it will ban flights from six African countries starting at noon on Friday (November 26). As Canada announced the same day, foreigners who have traveled to South Africa in the last 14 days will be banned from entering the country.
Thus, the crude oil market fluctuates sharply during the Friday trading session amid the Thanksgiving celebration in the US.
The Spot Market is Closed
Saturday, November 27, 2021