The price of crude oil is slowly rising in the
markets despite the recent volatility stemmed from the concerns over the
Omicron variant of the Coronavirus.
As of 14:30 GMT on Wednesday, the prices of WTI and
Brent were at $ 71.91 and $ 75.39 respectively.
The price of crude oil did not follow the pattern
that we see in the LNG, liquefied natural gas. It has come down nearly by 40%
from its peak in November that triggered offed a panic wave in the markets, especially
ahead of winter months in the northern hemisphere.
Analysts attribute the upward momentum of the crude oil
price to the diminishing danger of the latest outbreak of the Coronavirus:
although it appears to be highly transmissible, the death toll across the world
remains very low.
The medical experts, however, are quick to note that
it is far too early to say that the virus has ‘mellowed’ in order not to
destroy its host, human beings; it remains to be seen, though.
In another encouragement as far as the crude oil
markets are concerned, the US crude oil inventories have fallen by 3.089
barrels in the past week according to the API, American Petroleum Institute,
having been on decline for weeks.
Analysts are awaiting the report on the same today
by the EIA, the US Energy Information Administration, to see if the crude
inventory draw has been consistent.
If it turns out that way, the crude oil inventory
draw in the US, the world’s top oil consuming nation, is a clear indication
that the drop in price of crude oil at present does encourage the consumers to
use more – a classic example that proves there is a strong correlation between
the oil price and the use of the commodity by the consumers.
As the global economies show the signs of haggard
economic recovery, the demand will grow proportion, if the price of crude oil
stays in the region of $60 to $70 a barrel for a longer period – a win-win
situation both for consumers and producers.
