Oil prices slide more than 5% over omicron concerns

NEW YORK: Oil prices slumped more than 5 percent on Monday as surging cases of the omicron coronavirus variant in Europe and the US stoked investor worries that new restrictions to combat its spread could dent fuel demand.
Brent crude futures were down $3.98, or 5.4 percent, at $69.54 a barrel by 11:01 a.m. EST (1601 GMT), while US West Texas Intermediate crude futures fell $4.51, or 6.4 percent, to $66.35 a barrel.
Both benchmarks were at their lowest levels since early December.
“This is a knee-jerk reaction to the proliferation of the virus and the fear that lockdowns can rapidly spread,” said Andrew Lipow of Lipow Oil Associates in Houston.
The Netherlands went into lockdown on Sunday and the possibility of more COVID-19 restrictions being imposed ahead of the Christmas and New Year holidays loomed over several European countries.
Oil prices fell despite Moderna Inc.’s announcement on Monday that a booster dose of its COVID-19 vaccine appeared to be protective against omicron in laboratory testing.
Meanwhile, OPEC+ compliance with oil production cuts stood at 117 percent in November, up 1 percentage point from the previous month, two sources from the group told Reuters, as output continues to lag agreed targets.
In the US, energy companies added oil and natural gas rigs for a second week in a row.