By Gina Lee
Investing.com – Oil was mixed Friday morning in Asia, extending gains after the Organization of the Petroleum Exporting Countries and allies (OPEC+) decided to leave its supply addition plans unchanged at its latest meeting. However, the black liquid was still set for a sixth week of declines.
Brent oil futures rose 1.15% to $70.47 by 10:18 PM ET (3:18 AM GMT) and WTI futures jumped 1.32% to $67.38.
OPEC+ will stick to its plan of adding 400,000 barrels per day (bpd) supply in January 2022, it said after its meeting on Thursday. However, the cartel could change this policy swiftly if the new omicron COVID-19 variant hits fuel demand, and was prepared to meet before the next meeting scheduled for Jan. 4, 2022, if needed.
Omicron’s discovery has made for a volatile week over concerns of renewed lockdowns that would hurt fuel demand and push OPEC+ to pause output increases.
However, OPEC+’s surprise decision boosted prices with “traders reluctant to bet against OPEC+ eventually pausing its production increases,” ANZ Research analysts said in a note.
It makes sense for OPEC+ to stick with its policy for now, given it was still unclear whether omicron could resist existing vaccines, according to Wood Mackenzie analyst Ann-Louise Hittle.
“The group’s members are in regular contact and are monitoring the market situation closely. As a result, they can react swiftly when we start to get a better sense of the scale of the impact the Omicron variant of COVID-19 could have on the global economy and demand,” Hittle told Reuters.