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Oil futures fell Friday and were on track for weekly losses tied to worries about the spread of the omicron variant and its potential impact on fuel demand.
West Texas Intermediate crude for January delivery
CL00,
CLF22,
fell $1.58, or 2.2%, to $70.80 a barrel on the New York Mercantile Exchange, putting the U.S. benchmark on track for a 1.2% weekly fall. February Brent crude
BRN00,
BRNG22,
the global benchmark, was down $1.50, or 2%, at $73.52 a barrel on ICE Futures Europe, headed for a 2.2% weekly decline.
France on Thursday imposed fresh restrictions on travelers from the U.K. in response to the spread of the omicron variant. The U.S. is reporting more than 120,000 new cases of COVID-19 a day, up more than 40% from two weeks ago, according to a New York Times tracker.
The path of least resistance for oil, however, likely remains to the upside, said Tom Essaye, founder of Sevens Report Research, in a note, arguing that WTI could push back toward $75 a barrel thanks to the “OPEC+ put,” which “continues to fend off speculative short sellers despite deteriorating fundamentals,” a reference to the idea that the Organization of the Petroleum Exporting Countries and their allies can tamp down output if desired in response to omicron worries and other factors.
