Oil prices fall after report raises vaccine efficacy doubts

An oil pump jack of Canadian group Vermilion Energy is pictured in Parentis-en-Born, France, October 13, 2017. (Reuters)

SULAIMANI (ESTA) — Oil prices fell on Tuesday after a media report cast doubt on the efficacy of coronavirus vaccines against the Omicron variant, first detected in South Africa.

Brent crude futures fell $2.60 to $70.84 a barrel at 0656 GMT, while West Texas Intermediate (WTI) crude futures dropped $2.48 to $67.47 per barrel.

The head of drugmaker Moderna told the Financial Times that coronavirus vaccines are unlikely to be as effective against the Omicron variant of the virus as they have been against the Delta variant, Reuters reported.

The World Health Organization (WHO) said on Monday Omicron posed a very high risk of infection surges, and several countries stepped up travel curbs.

It is still unclear how severe the new variant is and whether it can resist existing vaccines.

With the demand outlook under a cloud, expectations are growing that OPEC, Russia and their allies, together known as OPEC+, will out on hold plans to add 400,000 barrels per day (bpd) of supply in January.

“We think the group will lean towards pausing output hikes in light of the Omicron variant and the oil stockpile release by major oil consumers,” Reuters quoted Commonwealth Bank commodities analyst Vivek Dhar as saying.

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