Crude oil prices inched down on Monday after rallying for five sessions amid sharp fall in oil inventories.
As of 1350 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, shed $0.16 (-0.20 percent) to reach $81.59 a barrel. On the other hand, the US West Texas Intermediate (WTI) price reached $78.70 a barrel, up by $0.20 (-0.25 percent).
The price for Opec Basket was recorded at $80.80 a barrel with a gain of 2.37 percent, Arab Light was available at $82.27 a barrel with an increase of 1.68 percent and the price of Russian Sokol reached $83.36 a barrel with an increase of 2.88 percent.
According to experts, a strong demand and sharp fall in oil inventories have pushed the market structure for Brent and US crude into deep backwardation. A backwardated market structure means the current value is higher than it will be in later months and encourages traders to release oil from storage and sell it promptly.
However, surging Covid-19 infections put pressure on oil prices. Despite early studies showing a lower risk of severe disease or hospitalisation from Omicron compared to the previously dominant Delta variant, healthcare networks across Spain, Britain, Italy and elsewhere have found themselves in increasingly desperate circumstances.
Moreover, prices surged after Kazakhstan – the second-largest oil producer in the former Soviet Union with a daily output of around 1.6 million barrels and an OPEC+ oil producer – was shaken by violent anti-government protests and witnessed a reduction in oil output.
