Oil prices seem to be recovering from late November when news of a new strain of coronavirus first broke. On Wednesday morning, a barrel of oil cost the most in a month, above $75 per barrel.
The price rises may be justified by investors' appetite for risk. It seems that it is currently stronger than the risks associated with the omicron mutation. Such a belief seems to be supported by research in South Africa, which has shown that omicron infections can increase resistance against the delta variant and potentially suppress it.
Oil prices may have gained more than 50 percent this year thanks to a return in demand and supply cuts by major oil-producing countries. However, supply could soon increase. On January 4, 2022, OPEC+ members will meet to decide whether to continue the 400,000 barrels per day production increase planned for February.
Indexes in Europe again up
The major European stock indices seem to reflect the positive attitude of investors. The German DAX gained yesterday and closed Tuesday's trading at its highest level in five weeks, near 16,000 points. The Euro Stoxx 50, in turn, ended Tuesday near its record high (4320 points), and the French CAC 40 broke the record by reaching nearly 7200 points.
Optimism on stock exchange floors also seems to justify investors' belief that the omicron will not derail the global economic recovery.
Daniel Kostecki, Director of the Polish branch of Conotoxia Ltd. (Forex service)
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