Unrest In Producing Counties Weighing On The Minds Of Oil Investors

Oil prices traded higher in early Monday action, but when it was all said and done, eventually closed slightly lower. West Texas Crude closed 1% lower, primarily on the unrest in oil producing countries, such as Kazakhstan and Libya. Patrick DeHaan with GasBuddy said oil and gas demand is bearish this time of year, especially with the holidays behind us, meaning what’s happening in oil producing countries takes center stage.

“I think that the expectation is that omicron will peak here in the weeks ahead, and Americans will get back driving this spring and that’s why the focus is more on the supply side of things, with some threats from major oil producing countries that potentially going to impact production now and moving forward.”

DeHaan said while Omicron will remain an issue, it will be more of a secondary concern, compared to concerns about meeting growing oil demand. Speaking of concerns, how concerned is DeHaan about building tensions between Russia and the West?

“Russia has been one of the counties that has wanted to push higher in terms of output.  Russia has been playing a little bit of a game with natural gas supplies for Europe.  Of course, its massive Nord Stream 2 pipeline is something they want to see approved by the EU and so far it hasn’t.  So, it’s hard to know whether Russia will start playing games with oil production.  So far, they have shown no evidence of doing that, but that remains a threat.”

What kind of impact is colder weather, specifically colder weather in the Pacific Northwest having on oil and fuel prices?