NEW YORK: Oil prices climbed by nearly 5% on Monday on hopes the Omicron coronavirus variant would have a less damaging economic impact if its symptoms proved mostly mild and as some OPEC member countries signaled confidence in the market.
Reports in South Africa said Omicron cases there had only shown mild symptoms and the top U.S. infectious disease official, Anthony Fauci, told CNN "it does not look like there's a great degree of severity" so far.
The White House said on Monday that the U.S. ban on foreign nationals entering the country from eight southern African countries is something President Joe Biden's public health advisers reconsider daily.
Brent crude rose US$3.20, or 4.6%, to settle at $73.08 a barrel. U.S. West Texas Intermediate crude rose $3.23, or 4.9%, to settle at $69.49 a barrel.
Last week, both benchmarks fell for a sixth week in a row.
"All the headlines are bullish today," said Phil Flynn, senior analyst at Price Futures Group. "The momentum seems to be jumping back in."
Global benchmark Brent has risen 38% this year, supported by output curbs led by the OPEC+ group of producers, though it has fallen from a three-year high above $86 in October.
Iraq's Oil Minister Ihsan Abdul-Jabbar said he expects oil prices to reach over $75, state news agency INA reported. He added that OPEC is trying to "positively contain" the energy market, INA said.
On Sunday, Saudi Arabia raised January official selling prices for all crude grades sold to Asia and the United States by up to 80 cents from the previous month.
The OPEC+ group, comprising the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, last week decided to continue increasing monthly supply by 400,000 barrels per day (bpd) in January, even after a slide in prices driven by Omicron concerns.
Oil was also buoyed by diminishing prospects of a rise in Iranian oil exports after indirect U.S.-Iranian talks on saving the 2015 Iran nuclear deal broke off last week.
Meanwhile, the World Petroleum Conference devoted to future technologies and low-carbon strategies kicked off in Houston on Monday with top executives from energy companies affirming the need for more oil for decades to come.
"We in fact are going into a period of scarcity. And I think that for the first time, in a long time, we will see a buyer looking for a barrel of oil, as opposed to a barrel of oil looking for a buyer," said Jeff Miller, chief executive of energy services firm Halliburton.- Reuters