Naveen Thakral

SINGAPORE (Reuters – Oil fell further Monday, as Omicron COVID-19 cases grew rapidly impacted economic activity. But losses were curbed in the face of supply interruptions in Kazakhstan and Libya.

Oil prices fell 38c, or 0.46% at $81.37 a barrel while U.S. West Texas Intermediate crude (WTI), was down 34c, or 0.43% at $78.56 a barrel.

The U.S. saw a decrease in employment due to worker shortages in December. However, there were some job gains that could continue in the short term.

More than 304.87 million people have been reported to be infected by the novel coronavirus globally and 5,834,506​ have died, according to a Reuters tally.

U.S. Energy firms began the New Year by adding oil and more rigs to their operations. This was after two years of declining rig counts.

Baker Hughes Co BKR.N, an energy service firm, reported that the number of oil and natural gas rigs, which are early indicators of future output, rose by two to 588 over the week to January 7. This is its highest level since April 2020.

But disruptions in supply from other regions of the globe are expected to increase prices.

Kazakhstan’s central city Almaty was under control by security forces. President Vladimir Putin said that the constitution had been mostly restored one day after Russia sent troops.

After state price caps for propane and butane were lifted on New Year’s Day, protests took place in Kazakhstan’s western oil-rich regions.

The operator of Kazakhstan’s largest oilfield Tengiz reported that production was cut at the field on Thursday. Chevron Corp (NYSE 🙂 stated that contractors interfered with train lines as a support for protests being held in the country.

The decline in production has been partly attributable to maintenance of pipelines.

The Organization of the Petroleum Exporting Countries (Russia and its allies), are not keeping pace with the demand for more supply.

December’s OPEC production rose by 70,000 bpd compared with the 253,000 bpd gain allowed under the OPEC+ Supply deal. This agreement restored output which was down in 2020, when the demand plummeted under COVID-19 lockdowns.