Crude oil futures ended lower on Tuesday, extending their previous session’s losses, on concerns about the outlook for energy demand on account of renewed restrictions on movement in several countries amid rising new cases of the Omicron variant of the coronavirus. Further, oil prices were also weighed down by a firm dollar amid increasing prospects of the Federal Reserve resorting to a faster pace of tapering of its asset-buying program following data showing an acceleration in US producer price inflation. Meanwhile, the International Energy Agency's (IEA’s) report said that the new variant would slow a recovery in demand for crude contributed as well to the decline in oil prices. The IEA has cut its 2022 supply forecast from non-OPEC producers by 100,000 barrels a day and has also said global demand for oil will drop by 100,000 barrels a day from its earlier forecast.
Benchmark crude oil futures for January delivery fell $0.56 or about 0.8 percent to settle at $70.73 a barrel on the New York Mercantile Exchange. Brent crude for February delivery declined $0.94 or 1.25 percent to settle at $73.45 a barrel on London's Intercontinental Exchange.