Crude oil futures closed higher overnight (Dec. 28) after investors eased concerns about the spread of COVID-19. There is the confidence that the Omicron virus will not affect the economy and oil demand.
Despite this, flight cancellations continue in the U.S. Delta Air Lines and Alaska Air Group have canceled hundreds of flights due to weather and Omicron cases. Delta alone is expected to cancel over 250 flights.
- WTI crude futures were up 41 cents, or 0.5%, at $75.98 a barrel.
- BRENT crude futures were up 34 cents, or 0.4%, at $78.94 a barrel.
Crude oil futures are rallying after the U.S. Centers for Disease Control and Prevention (CDC) recommended the government shorten the time to quarantine Americans exposed to COVID-19. The duration has been shortened from 10 to 5 days, and it is recommended that individuals wear masks whenever they come into contact with others for an additional five days. Here, the CDC makes no distinction between people who have already received two vaccinations and people who have not yet received one. This also means that asymptomatic cases can shorten their isolation period.
At the same time, the CDC recommends that those who have received the booster vaccinations do not need to go into quarantine after being infected, but should wear a mask for 10 days.
Investors will keep an eye on the OPEC and OPEC+ meeting on January 4, 2022, which is expected to discuss production policy for February 2022, as well as the EIA crude oil inventory report, which is expected to be released today.
API data show a further decline in U.S. crude oil inventory while gasoline inventory continues to rise. Crude oil inventory decreased by 3.1 million barrels whereas gasoline inventory increased by 319,000 barrels.
The Spot Market is Open
Wednesday, December 29, 2021