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Brent crude futures fell $1.14, or 1.5%, to $73.88 a barrel at
0952 GMT while U.S. West Texas Intermediate (WTI) crude futures
dropped $1.11, or 1.5%, to $71.27 a barrel. Brent and WTI are
both headed for a 1.4% loss this week.
In Denmark, South Africa and Britain, the number of new Omicron
cases has been doubling every two days. Denmark's Prime Minister
Mette Frederiksen on Thursday warned the government may impose
further curbs to limit its spread.
In the United States, the rapid spread of the Omicron variant
has led some companies to pause plans to get workers back into
offices.
"Messages of caution and warnings of a worsening COVID wave are
starting to ring louder with the approach of the year-end
holiday season, dampening market sentiment," said Vandana Hari,
energy analyst at Vanda Insights.
"Crude may remain in a holding pattern, albeit with plenty of
price volatility around the mean, in holiday-thinned trading
over the next couple of weeks."
The Organization of the Petroleum Exporting Countries, Russia
and allies, together known as OPEC+, have said they could meet
ahead of their scheduled Jan. 4 meeting if changes in the demand
outlook warrant a review of their plans to add 400,000 barrels
per day of supply in January.
But despite the Omicron threats to demand, Goldman Sachs said on
Friday the new variant has had a limited impact on mobility or
oil demand, adding it expects oil consumption to hit record
highs in 2022 and 2023.
Oil prices have also retreated from multi-year highs earlier in
the fourth quarter on improved supplies.
(Additional reporting by Sonali Paul in Melbourne and Roslan
Khasawneh in Singapore; Editing by Lincoln Feast and David
Evans)
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