OPEC+ sees the oil surplus worsening to 2 million barrels per day (BPD) in January, 3.4 million BPD in February, and 3.8 million BPD in March next year, according to an internal report.

"Generally, the impact of Omicron seems to be jet-fuel related for now, particularly in Africa and Europe," the report said. "Transportation fuel demand within Europe might be also affected," it added.

OPEC Monthly Oil Market Report, July 2021 - ROGTEC

OPEC Meeting

A group of some of the world's most powerful oil producers will meet on Wednesday to discuss the impact of the new omicron Covid variant on energy demand.

The Organization of Petroleum Exporting Countries, led by Saudi Arabia, is set to meet via videoconference at 1 p.m. London time. On Thursday, non-OPEC allies such as Russia will join the 13-member group.

There is little indication that the broader group, known as OPEC+, intends to change course from its current output plan of a monthly increase of 400,000 barrels per day.

OPEC ministers from Saudi Arabia and Iraq have both indicated that the group's output policy is likely to be maintained, while non-OPEC leader Russia stated earlier this week that there is no need for immediate action on the oil market.