The Organisation of the Petroleum Exporting Countries (OPEC) says crude oil spot prices dropped by $1.74, or 2.1 per cent, in November 2021 to average
$80.37 per barrel.
OPEC made this known in its Oil Market Report for December 2021 on Monday in Lagos.
“Crude oil spot prices declined in November, amid concerns regarding the emergence of the new Omicron COVID-19 variant, and easing of the energy crunch which had resulted in higher oil demand from the gas-to-oil switching.
“The OPEC Reference Basket (ORB) value dropped by $1.74, or 2.1 per cent, in November to average $80.37/b, amid lower prices of almost all medium and heavy sour grades in Asia, Europe, and the Americas.
“The year-to-date (y-t-d) ORB value reached $69.45/b, which is $28.71, or 70.4 per cent, higher compared with the same period last year of $40.75/b,” the report said.
According to the report, crude oil futures prices ended November sharply lower amid higher volatility after a broad selloff in futures and equity markets.
It said the Intercontinental Exchange (ICE) Brent first-month fell by $2.90, or
3.5 per cent, in November to average $80.85/b.
The report said the New York Mercantile Exchange and West Texas Intermediate (NYMEX WTI) declined by $2.57, or 3.2 per cent, to average $78.65/b.
It said : “Dubai Mercantile Exchange Oman crude oil futures prices fell by $2.11 m-om, or 2.6 per cent, to settle at $79.70/b in November.
“The spread between the ICE Brent and NYMEX WTI benchmarks narrowed further in November by 33¢ to average $2.20/b.
“Hedge funds and other money managers accelerated selling in November, contributing to the decline in oil prices.
“Combined speculative net length positions linked to ICE Brent and NYMEX WTI dropped to the lowest level since November 2020
“The backwardation structure in all three markets weakened considerably
in the second half of November.”
OPEC, however noted that world oil demand was unchanged compared to last month’s assessment, showing a growth of 5.7 mb/d in 2021.
The report said the oil demand was adjusted higher in first half of 2021 better-than-anticipated transportation fuel consumption in Organisation for Economic Cooperation and Development (OECD).
It said: “The fourth quarter 2021 oil demand was adjusted slightly lower, mainly to account for COVID-19 containment measures in Europe and the potential impact of the new Omicron COVID-19 variant.
“The forecast for 2022 is also kept unchanged at 4.2 mb/d.
“Indeed, some of the recovery previously expected in fourth quarter of 2021 is now shifted to first quarter of 2022, followed by a more steady recovery throughout second half of 2022.
“The impact of the new Omicron variant is expected to be mild and
short-lived, as the world becomes better equipped to manage COVID-19 and its related challenges.
“This is in addition to a steady economic outlook in both the advanced and emerging economies.”