“It’s likely to be a slow grind higher if optimism is sustained, but marked by plenty of volatility,” said Vandana Hari, founder of Vanda Insights. “Sentiment will remain highly susceptible to even hints of omicron’s destructive power.”

Oil is clawing back losses after sliding over the past six weeks in part due to the emergence of the new coronavirus variant and signs that major consumers would tap emergency crude stockpiles to tame surging prices. Saudi Arabia’s move on Sunday to increase the cost of its crude for January gave the market confidence the demand outlook would remain robust.

The release of crude from the Strategic Petroleum Reserve is part of the Biden Administration’s effort to tackle surging gasoline prices. While the winning bids for the first 32 million barrels won’t be announced until Dec. 14, at least two international oil refiners have expressed interest, people familiar said.

Omicron has prompted France to shut nightclubs for four weeks, while New York City called for a private sector vaccine mandate and Hong Kong imposed quarantine requirements on more countries. Energy Aspects cut its forecasts for jet fuel and oil demand following curbs on air travel.