Oil pares gains, but ends higher after Friday slump
- Wall St opens higher ahead of Fed announcement
- 'Living up to the Legend': Microsoft (MSFT) Stock Recovers Earlier Losses as Analysts Boost Price Targets Despite Azure Growth Slowdown
- Buy Any Further Significant Pullback in Equities - Goldman Sachs
- Oil hits highest since 2014 on Russia-Ukraine tension
- Texas Instruments (TXN) Shares Surge on Beat-and-Raise, Analysts Positive
FILE PHOTO: A sticker reads crude oil on the side of a storage tank in the Permian Basin in Mentone, Loving County, Texas, U.S. November 22, 2019. REUTERS/Angus Mordant
Get instant alerts when news breaks on your stocks. Claim your 1-week free trial to StreetInsider Premium here.
By Jessica Resnick-Ault
NEW YORK (Reuters) -Oil pared gains late on Monday, but finished the session higher as investors viewed Friday's slump in oil and financial markets as overdone absent more data on the Omicron coronavirus variant.
Brent briefly surged above $77 a barrel, while U.S. crude touched highs above $72. However, both contracts gave up gains late in the session.
Brent crude futures settled at $73.44 a barrel, up 72 cents or 1%, having slid by $9.50 on Friday. U.S. West Texas Intermediate (WTI) crude settled up $1.80, or 2.6% at $69.95 a barrel. The contract tumbled $10.24 in the previous session.
In post-settlement trade, Brent briefly turned into negative territory on thin volumes.
Friday's slide was the biggest one-day drop since April 2020, reflecting fears that coronavirus-related travel bans would hammer demand. The plunge was exacerbated by lower liquidity owing to a U.S. holiday.
"We believe that the plunge in oil prices has been overblown," said Michael Tran, an analyst at RBC Capital Markets, noting that the sharp fall in prices suggests a much weaker level of demand than is currently being seen.
If the new variant of the virus proves vaccine-resistant or more contagious than other variants, it could impact travel, commerce and petroleum demand.
The World Health Organization has said it could take weeks to understand the variant's severity, though a South African doctor who has treated cases said symptoms seemed to be mild so far.
Top officials from the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, echoed that view, with the Saudi energy minister quoted as saying he was not worried about the Omicron variant.
Omicron has created a new challenge for OPEC+, which meets on Dec. 2 to discuss whether to proceed with a scheduled January increase to oil output. OPEC+ has postponed technical meetings this week to gain time to assess Omicron's impact.
Brent prices have given up $10 in the past two weeks.
President Joe Biden urged Americans not to panic about the new COVID-19 Omicron variant and said the United States was working with pharmaceutical companies to make contingency plans if new vaccines were needed.
Saudi Energy Minister Prince Abdulaziz bin Salman al-Saud said he was not worried about Omicron, Asharq Business reported, while his Russian counterpart said he sees no need for urgent action on the market.
(Reporting by Jessica Resnick-Ault in New YorkAdditional reporting by Yuka Obayashi and Alex LawlerEditing by Marguerita Choy and Matthew Lewis)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- OPEC+ expected to stick to planned March output target increase, sources say
- Oil rises on concerns global political risks could tighten supplies
- Chesapeake Energy (CHK) Acquires Chief E&D Holdings for $2B Cash and 9.44M Common Shares
Create E-mail Alert Related CategoriesCommodities, Reuters
Related EntitiesRBC Capital, Crude Oil, OPEC
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!