OIL FUTURES: Crude, products settle higher on easing omicron concerns

Crude and oil products futures rallied Dec. 27 along with equities on easing concerns about the omicron variant.

NYMEX front-month crude settled at $75.57/b, up $1.78, while ICE front-month Brent settled at $78.60/b, up $2.46.

In refined products, NYMEX front-month RBOB settled 2.78 cents higher at $2.2339/gal and NYMEX ULSD settled 2.21 cents higher at $2.3535/gal.

Equities were also rallying, with the S&P 500 reaching a record high.

While airline stocks were under pressure because of flight cancellations over the holiday weekend, retailers were in the black on strong sales figures. Holiday sales, excluding automotive, jumped 8.5% on the year, according to Mastercard.

Gasoline sales have also risen as more drivers have taken to the road during the holidays. According to Patrick De Haan at GasBuddy, US demand over the Dec. 25-26 weekend climbed 33.95% on the year.

The omicron variant has "raised concerns that travel by car will be curtailed as workers and schoolchildren are asked to work from home," S&P Global Platts Analytics said in a report. "Despite these concerns, gasoline demand's fundamentals are strong. Not only are over 11 million job openings yet to be filled, but the latest initial claims data suggest roughly 500,000 new hires in December."

US gasoline stocks at 224.12 million barrels the week ended Dec. 17 were roughly 4% below the five-year average.

Inventories could rise as refiners increase runs, although strong demand could cause inventories to slip.

Also bullish for crude was news that India's crude imports in November reached their highest level in 10 months as refiners built inventories in anticipation of higher runs.

"China and India will resume their front-line status in being the engines of growth in 2022, but Southeast Asia will also contribute substantially, especially in countries with high vaccination rates," Platts Analytics said.