Is oil price rise a cause of worry?

Oil prices have been on an unabated uptrend for more than a month now. From a low of $69 per barrel, hit on December 1, 2021, Brent crude prices are above $86 per barrel now. This amounts to an approximate jump of 25% in four weeks.

Last Friday, crude prices notched a fourth positive week, its longest rising streak since October. This is because consumption has held up despite the spread of the Omicron variant of the coronavirus.

At the same time, spare capacity is dwindling as some of the world’s biggest producers struggle to boost output.

And now, analysts are predicting higher oil prices citing limited capacity, insufficient investment in new production, and the strength of demand.