Oil continued to plunge due to concerns of the Omicron variant spread and the possible fallout of President Joe Biden’s economic plans.
- Brent crude plunged by over 3% to hover around $71 per barrel in London but erased some of its losses later in the day after Moderna Inc. said its vaccines are highly effective in increasing protection against the Omicron variant.
- The West Texas Intermediate for delivery in January slipped 4.3% to $67.79, while contracts for February also declined by 4.3% to $67.65, with Brent showing a bearish contango pattern which indicates market oversupply.
- Analysts believe that the latest development is a “clear warning” for those with a bullish disposition, noting that the reimplementation of stricter restrictions is not a case of if, but a case of when.
The decline comes after New York recorded historic highs of new infections, with Mayor Bill de Blasio pushing a boost in test and treatment supplies.