Oil prices fell on Friday amid supply concerns stemming from the unrest in Kazakhstan and expectations of cuts in Libya.
Brent crude fell 24 cents, or 0.3%, to $81.75 a barrel, while West Texas Intermediate (WTI) crude fell 56 cents, or 0.7%, to $78.90 a barrel.
Brent rose 5.2%, while WTI rose 5% in the first week of the year, prices reached their highest level since late November fueled by supply concerns.
US job growth fell short in December, raising questions about where to go, and Omicron fears continue to weigh on the market.
Protests in Kazakhstan began in the oil-rich western regions of Kazakhstan after the removal of cap prices on butane and propane at New Year’s.
Security forces are trying to control the streets in Kazakhstan’s main city of Almaty, and constitutional order has been restored a day after Russia sent troops to quell the riots, the president said.
Oil operator, Chevron Corp, said on Thursday that production at Tengiz, Kazakhstan’s largest oil field, had slumped and some contractors had cut train lines to support protests in the country.
Production in Libya fell to 729,000 bpd from 1.3 million bpd last year, in part due to pipeline maintenance work.
A barrel of oil for March delivery sold at the highest level since November, at a discount of up to 70 cents per barrel for February delivery.
Both indicators rose $1 at the start of the session but came under pressure after US employment numbers fell short of expectations, along with oil, stock markets and the dollar.
U.S. employment rose less than expected in December due to worker shortages, and job gains may remain modest in the near-term as rising COVID-19 infections disrupt economic activity.
This week’s government data showed crude inventories in the United States, the world’s largest consumer, fell to the lowest level since September for six consecutive weeks through the end of the year.
Extreme cold weather in North Dakota and Alberta is also expected to hurt production in the region, caused operators to briefly shut down the 590,000 bpd-capacity Keystone Pipeline earlier this week.
Baker Hughes Co. said U.S. oil rigs soared this week to 481, their highest level since April 2020.
While the Omicron coronavirus variant is holding fast, demand-side concerns are easing thanks to growing evidence that it is less severe than previous variants, meaning major mobility restrictions are unlikely.
Meanwhile, the supply additions by the Organization of the Petroleum Exporting Countries, Russia and its allies are not keeping up with the increase in demand.
