Oil prices increased on Thursday due to market expectations of a delay in the implementation of an incremental supply return policy of producers from the Organization of Petroleum Exporting Countries and allies (OPEC+) given the raised demand concerns from the spread of the new COVID-19 variant.
International benchmark Brent crude was trading at $69.75 per barrel at 0626 GMT for a 1.3% increase after closing the previous session at $68.87 a barrel.
American benchmark West Texas Intermediate (WTI) was at $66.47 per barrel at the same time for a 1.4% rise after trade ended at $65.57 a barrel in the previous session.
Investors are focused on the upcoming OPEC+ ministerial meeting on Thursday, where major producers are set to decide the production volume for January.
The OPEC+ group had been adding 400,000 barrels per day (bpd) each month since August this year, however, the market sentiment is that growing concerns over the new COVID-19 variant may result in a delay to this pact to balance the market.
Last week, South African scientists announced the discovery of a new highly-mutated COVID-19 variant and reported it to the World Health Organization (WHO), which named it omicron.
Days later, several countries imposed travel bans on South Africa and other southern African countries, including Namibia, Lesotho, Botswana, Eswatini, Malawi, Zimbabwe and Mozambique.
The WHO Director-General Tedros Ghebreyesus said Wednesday that at least 23 countries from five of six WHO regions have now reported cases of the new omicron variant, with numbers only expected to grow.
US stocks decline
Meanwhile, US commercial crude oil inventories decreased 0.2% during the week ending Nov. 26, according to the latest data released by the Energy Information Administration (EIA).
Inventories fell by 900,000 barrels to 433.1 million barrels, against the market expectation of a 1.7 million-barrel fall.
Strategic petroleum reserves, which are not included in commercial crude stocks, also declined by 1.9 million barrels to 602.6 million barrels last week, the data revealed. However, gasoline inventories increased by 4 million barrels to 215.4 million barrels over that period.
The less-than-expected inventory drop added to the negative market sentiment, putting downward pressure on prices.
Source: Anadolu Agency