Oil rises to $82 in hopes of demand recovery

Oil rises to $82 in hopes of demand recovery

/ Oil & Gas / Wednesday, 12 January 2022 08:19

Oil rose to around $82 a barrel, buoyed by tight supply and hopeful global demand recovery, despite concerns of rising spread of the Omicron variant.

OPEC supply additions ran below their allowed increase under a pact with allies due to a lack of capacity in some countries. OPEC/O economies have avoided a return to severe lockdowns, even as coronavirus cases soar.

Brent crude gained $1.14, or 1.4%, to $82.01 a barrel at 1134 GMT, after dropping 1% in the previous session. US West Texas Intermediate (WTI)  rose $1.16, or 1.5%, to $79.39, after falling 0.8% on Monday.

Analysts have been fairly optimistic on the global recovery.

Brent rose 50% in 2021 and has rallied further in 2022 as investors see demand rising while OPEC and its allies, known as OPEC+, slowly ease record output cuts made in 2020.

Disruptions in Libya have also supported prices and while production has risen, the National Oil Corp. has said it was suspending exports from the Es Sider terminal.

A weaker US dollar also helped support oil as it makes oil cheaper for those holding other currencies and tends to reflect higher investor risk appetite.

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