Oil prices settled more than 3% higher on Tuesday, rebounding on renewed risk appetite the day after a sharp fall, but investors remained cautious as the Omicron coronavirus variant cut holiday travel plans, dimming the near-term fuel demand outlook.
“This is a pragmatic market that wants to be bullish but knows relief rallies, like the one this morning, will not last,” said Tamas Varga, oil analyst at London brokerage PVM Oil Associates.
“The upside is likely to be limited and more restrictions will be greeted with renewed selling,” he added.
Brent crude settled up $2.46, or 3.4%, at $73.98 a barrel, and U.S. West Texas Intermediate (WTI) crude rose $2.51, or 3.7%, to $71.12 a barrel.
