Markets

Even though the new COVID-19 variant has been found to be more highly infectious than previous strains, it has, so far, resulted in fewer hospitalizations than had been feared, so the demand impact is now expected to be less than initial projections indicated.

As more cases of the new COVID-19 variant appeared in various countries around the world and in states all across the US, futures prices for NYMEX WTI and RBOB, ICE Brent and gasoil, and DME Oman crude fell over the week ending Dec. 3, though the declines were much less severe than they had been in the previous week.

Earlier in the week ending Nov. 26, the market fluctuated between the moderately bearish news of US President Joe Biden having convinced the leaders of other consuming nations to release crude from their strategic petroleum reserves (SPRs) and the bullish news that OPEC+ was considering slowing its production increases in response.

Throughout most of the week ending Nov. 19, market chatter focused on a shift from concerns about tight supplies to worries that a surplus will soon begin building.

Prices for front-month NYMEX WTI and ICE Brent futures slipped for a third week in a row as of Nov. 12 while NYMEX RBOB and ULSD decreased for a fourth consecutive week.

Prices for front-month NYMEX WTI and ICE Brent futures declined for a second week in a row while DME Oman crude and NYMEX RBOB and ULSD fell for a third consecutive week.

Prices for front-month NYMEX WTI and ICE Brent futures broke their respective nine- and seven-week bullish streaks. Even though prices were pressured at mid-week by surging US crude inventories, the ongoing demand recovery is keeping the supply/demand balance tight.

The prices for front-month NYMEX WTI and ICE Brent futures have now risen for nine and seven weeks in a row, respectively. On the other hand, DME Oman, NYMEX RBOB and ULSD, as well as ICE gasoil broke their five-week streaks of price increases as of Oct. 22.

The steady march through autumn toward winter seems to have energy traders on edge, as there are few signs of supply increases large enough to dent prices.

While parts of the world are still suffering through renewed COVID-19 outbreaks, demand for various forms of energy has returned to pre-pandemic levels even though supplies of some products have lagged, causing their prices to surge.