Oil down by nearly 2% as omicron variant fears continue to reverberate

WTI down to $68.50 levels on the day

Of note, the drop back below $70 and the 200-day moving average (blue line) near the figure level keeps sellers in control, with yesterday’s light rebound proving to be a dead cat bounce – more so now after the Moderna CEO headlines hit.

If vaccines aren’t going to be effective in managing the spread of the omicron variant, it will be tough to imagine a world where we hit the reset button back to the start of the year.

I don’t imagine governments across the world would be too keen on that.

Sure, sure. Banchel has some perverse incentive when it comes to making such comments but the general mood in the market since Friday hasn’t been good to begin with.

This just brings out the fear that is residing deep within the market.

Going back to oil, while all this may prove to be a hiccup in the long-run, there isn’t a rush to really get into longs at the moment – not when omicron fears are still ever present and the volatility could still extend for many more weeks.

The August lows just below $62 may be a key target for sellers if risk trades continue to be hit hard in the meantime.