Meanwhile, top energy officials decide not to visit U.S. as travel restrictions tighten: File Image/Pixabay
The White House declining on Friday to say whether it would release oil from the Strategic Petroleum Reserve to help tame energy prices was enough to cause another round of losses for crude – and the longest run of weekly losses since March.
Phil Flynn, senior market analyst at Price Futures Group Inc., said, "Oil is in correction mode and the first key support is the psychologically important US$80 per barrel area.
"The fear is greater than the reality of what the Biden administration can do to bring down oil and gas prices."
Phil Flynn, senior market analyst, Price Futures Group Inc.
Oil is in correction mode
West Texas Intermediate crude for December delivery fell 80 cents to settle at $80.79 per barrel; Brent dropped 70 cents to end the session at $82.17 per barrel.
According to data compiled by Bloomberg, combined open interest in four Brent and WTI contracts, alongside the primary gasoline and diesel futures, has plummeted to its lowest level since July 2016, with almost 1 million futures contracts liquidated since mid-October.
Christyan Malek, head of EMEA oil and gas research at JPMorgan Chase & Co., said investors "don't want to go on holiday and come back and oil is down 30 percent, this is just too high octane," and therefore the market is stuck in a "kind of paralysis."
As for the omicron variant, no end of reports that it extremely mild sickness or may be the end of the pandemic has buoyed the oil market (or most world governments) to any degree, and the negative impact of the virus overall was exhibited by BP, Qatar Energy and Sonatrach announcing they were backing out of next week's World Petroleum Congress, due to "concerns over potential changes to travel restrictions by their countries of origin," conference organizers said in an email on Friday.