The price of crude oil fluctuated bet-ween $76.052 and $72.532 per barrel on Monday, while WTI crude rose 0.21 per cent settling at $75.73 per barrel.
Crude oil prices, which have recovered since last week, continued to rise in the Asian market on Tuesday with optimism over the impact of the new Omicron Covid-19 variant.
However, the oil supply shortage, according to investing.com, remains tight.
Investing.com quoted Singapore-based DailyFX analyst Leona Liu as saying: “Though Omicron is spreading faster than any Covid-19 variant yet, a relatively relieving news is that most people infected with Omicron are showing mild symptoms, at least so far. “
It added: “The UK government [as a result] will not introduce new Covid-19 restrictions for England before the end of 2021, according to its health minister.”
Oilprice.com’s writer Irina Slav reported on Monday: “Even as the latest coronavirus variant caused fears of new lockdowns and other restrictions, Saudi Arabia raised its official selling prices for oil for Asian buyers and by a hefty $0.60 per barrel.
“The decision to hike prices demonstrates confidence that demand for oil will remain robust despite the pandemic.
“The confidence was also highlighted earlier this month when OPEC+ [the Organization of Petroleum Exporting Countries and its allies] decided to add another 400,000 bpd to combined production in January despite the US administration’s decision to release up to 50 million barrels of crude in a bid to lower retail fuel prices,” she added.
Overall, oil prices have jumped by more than 50 per cent this year, driven by recovering demand and supply cuts by OPEC+.
Based on these fundamentals, supported by the technical pattern indicators, the price of crude oil this week will hover around $62 and $78.760 per barrel.
Therefore, crude traders can wait to buy at $70.556 per barrel by setting a take-profit function at $75.500 and a stop-loss at $67.443 per barrel.