Oil prices experienced a significant shock towards the end of last week with WTI dropping almost 14% after news emerged of the new Omicron covid variant which threatened to impact several major aspects of the economy in the near future. While details surrounding the situation remain unclear, fears related to potential lockdowns or restrictions have impacted many assets with a particular focus on oil as the commodity has experienced significant volatility in recent months. Part of the problem is also the unclear situation related to supply, as OPEC decided to delay it’s technical meeting from Monday and Tuesday to Wednesday and Thursday as the group awaits further details from the WHO on the severity of the variant. In the meantime, we can see a significant rebound in oil prices today with WTI hovering around $71.60 and Brent trading at $75 while investors pay close attention to any news regarding the developing circumstances and as governments deliberate on potential measures to contain the spread.
UK consumer credit data disappoints
Today’s slightly below expectations mortgage lending continues to show the reluctance of UK consumers as they contend with increasingly high property prices, rising inflation and uncertainty regarding the covid-19 situation. Furthermore,a cause of concern could be that net lending to individuals was significantly below expectations, coming in at £2.3B compared to the expected £9.7B, this could lead to a slower than expected economic rebound as we head into the holiday season which could be exacerbated by other factors such as potential lockdowns or restrictions.