Oil prices drop after news of omicron COVID-19 variant broke Friday

California High Gas Prices
Posted at 12:44 PM, Nov 29, 2021
and last updated 2021-11-29 12:46:17-05

VIRGINIA BEACH, Va. - Crude oil prices initially decreased more than $10 to $68 a barrel on Friday after reports of the omicron COVID-19 variant, according to AAA Tidewater.

The national average price for a gallon of gas also dropped a penny last week to $3.39. This average is a penny less than a month ago and $1.27 more than a year ago.

“It’s too soon to tell if fears of a global economic slowdown caused by the Omicron variant will push oil prices lower for the long term,” said Holly Dalby, AAA Tidewater director of public affairs. “But for now, the upward pricing pressure due to tightened supply and high demand seems to have abated, and that will likely result in pump prices stabilizing.”

Across Virginia, prices have slightly decreased, AAA Tidewater reports. The state's average pump price dropped two cents to $3.24.

Locally, the average dropped two cents to $3.19, nine cents lower than last month and $1.12 higher than a year ago.

AAA Tidewater says how much of a price impact, and how long the price relief at the pump will last, depends on the total amount of oil that moves into the market after the coordinated releases around the globe. This week, crude prices could continue to drop if the global market begins to see an increase in supply from the joint releases or EIA's next report shows another increase in total domestic supply.