Crude Oil Lower; IEA Points to Omicron-Related Demand Hit By Investing.com – Investing.com

Crude Oil Lower; IEA Points to Omicron-Related Demand Hit By Investing.com – Investing.com

© Reuters.

By Peter Nurse   

Investing.com -- Oil prices fell Tuesday after the International Energy Agency cut its forecast for oil demand in the first quarter, saying the new Omicron coronavirus variant will dent the global recovery. 

By 9:15 AM ET (1415 GMT), futures traded 1.5% lower at $70.25 a barrel, while the contract fell 1.4% to $73.32. 

U.S. Gasoline RBOB Futures were down 0.8% at $2.0996 a gallon.

Global oil markets have returned to a surplus and face an even bigger oversupply early next year as the Omicron variant hits international travel, the International Energy Agency said, cutting its forecast for global oil demand in the first quarter by 600,000 barrels a day.

“The surge in new Covid-19 cases is expected to temporarily slow, but not upend, the recovery in oil demand that is under way,” the Paris-based agency said.

This contrasted with the view of the Organization of the Petroleum Exporting Countries, as OPEC released a report earlier this week in which it raised its world oil demand forecast for the first quarter of 2022.

Many countries in Europe have already introduced new mobility restrictions, with U.K. Prime Minister Boris Johnson warning of a “tidal