SULAIMANI (ESTA) — Oil prices fell for a third day straight on Wednesday on growing expectations that supply growth will outpace demand growth next year.
Brent crude futures fell 91 cents to $72.79 a barrel at 0558 GMT, after losing 69 cents on Tuesday.
U.S. West Texas Intermediate (WTI) crude futures fell $1 cents to $69.73 a barrel, after losing 56 cents in the previous session.
The International Energy Agency (IEA) said on Tuesday a surge in COVID-19 cases with the emergence of the Omicron variant will dent global demand for oil at the same time that crude output is set to increase, especially in the United States, with supply set to exceed demand through at least the end of next year, according to Reuters.
In contrast, the Organization of the Petroleum Exporting (OPEC) on Monday raised its world oil demand forecast for the first quarter of 2022.
“The IEA’s bearish view on the market was in stark contrast to OPEC’s more positive view when it released its monthly outlook earlier this week. The divide suggests volatility is likely to remain high in the short term,” Reuters quoted ANZ commodity analysts as saying.
Energy consultancy FGE said it has a more optimistic outlook than the IEA as the consultancy expects a smaller surplus of 400,000 barrels per day, based on a comparatively lower demand risk from Omicron, against IEA’s forecast of 1.7 million bpd in the first quarter.
