Jessica Jaganathan

SINGAPORE, (Reuters) – Oil prices rose on Tuesday but investors remain concerned about Omicron coronavirus’ rapid spread globally. This has prompted countries to reconsider imposing additional restrictions that could reduce fuel demand.

The futures price rose 9.1% to $71.61/barrel by 0105 GMT. U.S. West Texas Intermediate oil futures rose 23 cents per barrel, or 0.3%.

Analysts from JBC Energy stated that it was becoming more likely that restrictions will be reimposed in the UK after Boxing Day (Dec 26), and daily cases are moving at record levels,” they wrote in a Tuesday note.

Boris Johnson, British Prime Minister said that coronavirus restrictions would be tightened to reduce the spread of Omicron variant. He made this statement Monday after the Netherlands instituted a fourth lockdown.

Omicron infection is rapidly increasing in Europe and America. It doubles every 2 or 3 days in London, and other parts of the world. This has a serious impact on global financial markets which are worried about the potential consequences for the recovery.

Still, Moderna (NASDAQ) Inc stated Monday that a booster dosage of COVID-19 vaccine was showing some protection against Omicron virus, which is rapidly spreading in laboratories. Investors have hope.

Two sources within OPEC+ told Reuters that OPEC+’s compliance with its oil production cut agreements rose to 117% in November, compared to 116% a month prior. This indicates that production levels are still well below the agreed target.

The United States’ crude oil stocks were forecast to fall for the fourth week in a row, while gasoline and distillate stockpiles are likely to rise, a preliminary Reuters poll indicated on Monday.

The survey was taken ahead of reporting from the American Petroleum Institute on Tuesday and EIA on Wednesday, which are statistical arms of U.S. Department of Energy.