Crude prices stabilized at a two-month high on Friday as demand remained stable despite a high number of Covid-19 infections and in a context of tight supply due to operational disruptions in some oil-producing countries. oil.
Brent, the international benchmark, rose more than 5% during the week, while West Texas Intermediate, which tracks US crude grades, also gained around 5%. Brent fell 0.29% to $ 81.75 per barrel on Friday, while WTI fell 0.7% to close at $ 78.90 per barrel.
“Oil prices continue to climb over the weekend as unrest in Kazakhstan and declining Libyan production further hamper the ability of producers to gradually return to pre-pandemic levels,” said Edward Moya, analyst at main market at Oanda.
“And this is happening at a time when demand is expected to remain strong thanks to Omicron’s symptoms being mild compared to other variants.”
Protests erupted last week in Kazakhstan, a major oil producer and member of OPEC +, over rising fuel prices. This has led to large-scale violence across the country.
Dozens of people have died and public buildings across the country have been ransacked and set on fire in the worst violence the former Soviet republic has seen in 30 years of independence.
Kazakh President Kassym-Jomart Tokayev on Friday ordered security forces to “shoot to kill” to quash protests as protests continued across the country.
Production in Libya, also a member of OPEC, plummeted due to pipeline maintenance work which contributed to the rise in crude prices.
“The current strength in energy prices can be largely attributed to the global narrative of tight supply,” said Vijay Valecha, chief investment officer at Century Financial, citing the unrest in Kazakhstan as well as “extremely cold” conditions. in North America which disrupted production in Canada.
“Much of western Canada has been in deep frost for the past two weeks. Due to the extremely cold conditions, oil production from the Bakken field in the United States and North Dakota was brought to a halt. “
Opec +, which is led by Russia and Saudi Arabia, decided to add an additional 400,000 barrels of oil per day to the market in February, the group expecting continued demand for crude.
Last month, Opec raised its forecast for global oil demand for the first quarter of 2022, but left its annual growth projection unchanged as it expected the Omicron variant to have a slight impact on demand. .
The Oil Producers Group expects demand for crude to average 99.13 million bpd in the first quarter of 2022, up 1.11 million bpd from its November forecast. Growth in world oil demand was unchanged at 4.2 million bpd for the full year and total world consumption stood at 100.6 million bpd.
Update: January 8, 2022, 8:38 a.m.