Oil closes the month under strong pressure

The main oil benchmarks closed November with strong pressure due to a new uncertainty about the future of demand, registering the largest monthly contraction since March 2020, with the WTI trading at 66.18 dollars per barrel, the Brent at 70.57 dollars per barrel and the Mexican mix at $ 63.16 per barrel, indicated an analysis by Banco Base.

In the penultimate month of the year, West Texas Intermediate (WTI), the benchmark oil in the United States, fell 20.81%, Brent, the benchmark crude in the European market, fell 16.37% and the Mexican mix fell 18.61 percent .

The negative performance of crude oil prices during November was derived from three factors, Banco Base specialists indicated. One was the release of crude reserves in some major oil consuming countries.

“The White House confirmed the release of 50 million barrels of oil from its strategic reserve to the market. India will add another 5 million barrels to its emergency reserves and the United Kingdom will contribute 1.5 million barrels ”, they pointed out.

A second factor was the fear around the new strain of Covid-19 that is spreading rapidly in southern Africa, prompting the European Union, Singapore and the United Kingdom to take action to stop air travel from the region.

The third factor is that the US Energy Information Administration estimated higher crude production, which will increase to 11.6 million barrels per day in December and by 2022 it will be 11.9 million barrels per day.

This Tuesday, crude prices fell. The WTI fell 5.39%, the Mexican mix 5.01% and the Brent 3.91%, after the comments of the executive director of the pharmaceutical company Moderna, Stephane Bancel, about the low probability that the current Covid-19 vaccines are not as effective against the Omicron variant.

“Energy traders will be stuck for the next two weeks until a clearer picture emerges on how bad roadblocks and travel restrictions get with this new variant,” said Ed Moya, Senior Market Analyst at OANDA.

[email protected]


Leave a Comment