Oil prices eased on Wednesday, taking a breather after two days of gains, as investors waited for an assessment of full impact of the Omicron coronavirus variant on global economy and fuel demand as well as the effectiveness of existing vaccines, Trend reports with reference to Reuters.
Brent crude futures dropped 19 cents, or 0.3%, to $75.25 a barrel at 0519 GMT, after settling 3.2% higher on Tuesday. U.S. West Texas Intermediate crude was at $71.82 a barrel, down 23 cents, or 0.3%, having gained 3.7% in the previous session.
Oil prices rebounded earlier this week from a collapse last week on rising optimism that the new Omicron variant will not cause major economic damage.
"The recovery run took a break as investors tried to confirm full impact of the Omicron variant before buying further," said Satoru Yoshida, a commodity analyst with Rakuten Securities.
The Omicron variant can partially evade the protection from two doses of Pfizer and partner BioNTech's COVID-19 vaccine, the research head of a laboratory at the Africa Health Research Institute in South Africa said on Tuesday.
British drugmaker GSK, meanwhile, said on Tuesday its antibody-based COVID-19 therapy with U.S. partner Vir Biotechnology is effective against all mutations of the Omicron variant.
"Investors are still not fully optimistic and are taking a wait-and-see approach for now," said Hiroyuki Kikukawa, general manager of research at Nissan Securities.
Oil markets reacted little to the U.S. weekly inventory data.
U.S. crude stocks fell last week while gasoline and distillate inventories rose, according to market sources citing American Petroleum Institute figures on Tuesday.
Analysts polled by Reuters forecast U.S. crude inventory data would show a second straight weekly decline.