09:07 AM EST, 12/06/2021 (MT Newswires) -- Oil traded higher early on Monday following reports the Covid-19 omicron variant may not cause severe illness and as talks to revive the 2015 nuclear deal with Iran are said to be floundering.
West Texas Intermediate crude for January delivery was last seen up US$2.06 to US$68.32 per barrel, while February Brent crude, the global benchmark, was up US$2.10 to US$71.98.
The gains come even as the omicron variant is detected is a rising number of countries, with Poland the latest to introduce new restrictions, according to a report from the Guardian. However South Africa is reporting that children hospitalized with the variant are mostly experiencing mild symptoms while Anthony Fauci, the chief medical advisor to the U.S. president, told CNN he is optimistic current vaccines may prove effective against the variant, easing fears that the spread of the variant will force renewed lockdowns.
Indirect talks to renew the 2015 Iran nuclear deal are also not going well, with U.S. Secretary of State Antony Blinken saying the Iran's government does not seem to be serious about renewing the accord, according to a Reuters report, putting off the prospect of the return of the country's oil exports to the international market.
Saudi Arabia raised its selling price to U.S. and Asian customers on the weekend by US$0.60 per barrel.
"The higher premiums for Asia and the US can be regarded as signs of robust demand. This underpins last week's decision by OPEC+ to expand oil production by an additional 400,000 barrels per day in January," Commerzbank analyst Carsten Fritsch said in a note.