Oil prices declined on Tuesday as fears surrounding the new, heavily mutated coronavirus variant negated positive investor sentiment amid uncertainties ahead of the meeting of major oil-producing countries.
International benchmark Brent crude was trading at $71.39 per barrel at 0619 GMT for a 2.49% decrease after closing the previous session at $73.22 a barrel.
American benchmark West Texas Intermediate (WTI) was at $68.27 per barrel at the same time for a 2.40% loss after trade ended at $69.95 a barrel in the previous session.
Prices have come under demand pressure since the emergence of omicron, the new COVID-19 variant, which is triggering fears of a new economic downturn.
A number of countries, including the UK, US, Canada, Germany, France, Japan, Israel, India, Australia, Netherlands, Philippines, Italy, Malta, Pakistan, Iran, United Arab Emirates, Qatar, Saudi Arabia, Kuwait and Oman have imposed travel bans on African nations amid fears of the spread of omicron.
Describing the new variant as a 'variant of concern,” the World Health Organization (WHO) said Sunday there is no evidence so far concerning the transmissibility or severity of the new omicron strain.
However, it is still not clear how effective the existing vaccines are on the variant.
Investors are now eyeing the meeting of the Organization of Petroleum Exporting Countries and allies (OPEC+) group, on Thursday.
The group will decide its production volume for January, however, if no change is made to the existing deal, then around 400,000 barrels per day (bpd) will be produced and distributed.
Traders are also waiting to see if the group will react to the US-led strategic reserve sale move which was supported by China, India, Japan, South Korea and the UK.
Last week, US President Joe Biden announced his much-expected oil sale from the country’s reserves to provide additional market supply and lower crude prices.
The US Department of Energy will release 50 million barrels of oil from the Strategic Petroleum Reserve (SPR), the largest petroleum stockpile in the world used for emergencies.
By Sibel Morrow
Anadolu Agency
energy@aa.com.tr