Oil prices increased more than 5% during the week ending Dec. 23, amid dissipating concerns over the omicron variant of coronavirus, and the positive outlook in the markets, supported by macroeconomic data announced in the US and statements on the ability of China to sustain its economic growth.
International benchmark Brent crude ended Thursday session at $76.52 per barrel, posting a 5.08% increase from the Monday session that opened at $72.82 a barrel, in international markets.
The US markets are closed for sessions on Friday - Christmas Eve, in observance of the Christmas holiday.
American benchmark West Texas Intermediate (WTI) closed at $73.72 per barrel on Thursday, increasing 5.21% relative to the opening price of $70.07 a barrel on Monday.
The markets started the week on a negative note on Monday as markets over the worries that the omicron becomes the dominant strain of the coronavirus in most parts of the world.
Later in the day American firm Moderna said that a booster dose of its COVID-19 vaccine appeared to protect against the omicron variant in laboratory testing, providing some hope of economic recovery and support to the oil market.
Supporting higher prices, the American Petroleum Institute announced late Tuesday its estimate of a fall of 3.67 million barrels of US crude oil inventories, far exceeding the market expectation of a 2.63-million-barrel drop.
Oil prices increased on Wednesday over statements on the ability of the world's second-largest economy, China, to sustain its economic growth.
The Chinese government will step up government spending, strengthen support for manufacturers and small companies, and ensure price stability, the deputy head of the National Development and Reform Commission, China's economic planning body, Ning Jizhe, confirmed in an interview with Xinhua on Wednesday.
The world's biggest oil importer is preparing for next year's economic plan in advance to 'strive to stabilize economic operations in the first quarter, the first half and even the whole year', Ning told Xinhua.
However, the surge in COVID-19 omicron variant cases curtailed further price increase.
The dollar fell to new lows after data on Wednesday showed a more-than-expected improvement in US consumer confidence.
The more-than-expected decrease of crude oil stocks in the US also supported the increase in oil prices.
Crude oil stocks decreased by 4.7 million barrels, or 1.1%, for the week ending Dec. 17, according to the US Energy Information Administration.
Oil prices continued to rise on Thursday, bolstered by a higher volume of trade in commodities due to the weaker dollar and lower-than-expected crude stocks in the US.
The positive outlook in the markets was supported by the macroeconomic data announced in the US. The growth data for the third quarter of the country was revised from 2.1% to 2.3%.
Following the third-quarter data, the US economy contracted by 3.4% last year, while the growth expectation for 2021 rose to 5.6%, marking the highest level since 1984.
Dissipating concerns over the omicron variant of coronavirus have spurred a relief rally in global markets ahead of the Christmas holiday.
Patients infected with the omicron variant of the coronavirus have a lower risk of hospitalization compared to those who contracted the delta variant and are significantly less likely to develop severe symptoms, according to a study by the UK Health Security Agency (UKHSA).
The UKHSA analysis mirrored those by Public Health Scotland and Imperial College London on Wednesday which also found omicron to be milder than previously thought when compared to the delta variant.
These studies were also supported by data from South Africa, where the new variant originated.
However, investors still remain cautious over anticipated lower global oil demand from surging COVID-19 omicron variant cases and the potential adoption of more restrictive measures.
By Firdevs Yuksel
Anadolu Agency
energy@aa.com.tr