U.S. oil once fell nearly 8%, refreshing its low point since August 23 to $64.43 per barrel. Earlier, Fed Chairman Powell said that the U.S. economy is strong and there may be reasons to complete the reduction earlier. Oil prices plummeted in November, and both WTI and Brent crude oil benchmarks recorded their biggest monthly declines since March 2020. Oil prices fell more than 20% in November, and most of the decline was recorded in the last two weeks.

The newly discovered Omicron mutant strain has had a major impact on the prospects for crude oil demand. Many countries have issued travel bans to South Africa, and South Africa is what people think is the Omicron mutant. The origin of the strain. Although oil prices ushered in the beginning of December with a rising posture, there is a long way to go in the future.

Rystad Energy senior oil market analyst Louise Dickson said that the threat to oil demand is real. Another wave of blockade may reduce oil demand in the first quarter of 2022 by as much as 3 million barrels per day. At present, governments will be healthy and safe. The importance of this is placed above the restart plan. From Australia’s postponement of restart to Japan’s ban on foreign tourists, these are all obvious evidence.

OPEC+ will meet this week to discuss whether to increase the market supply of 400,000 barrels per day. However, considering the recent development of the epidemic and the plunge in oil prices, this oil organization may choose a more cautious path. If the implementation of the previously planned increase of 400,000 barrels per day of oil supply continues, then it may face the risk of further decline in oil prices. Analysts predict that the crude oil market will face an oversupply situation next year, because the demand for crude oil has stabilized as production capacity increases.

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