MELBOURNE (Reuters): Oil prices edged down yesterday but were set to post their biggest annual gains in 12 years, spurred by the global economic recovery from the COVID-19 slump and producer restraint, even as infections surged to record highs around the world.

Brent crude futures fell 3 cents to $ 79.50 a barrel at 0718 GMT, while US West Texas Intermediate (WTI) crude futures dropped 10 cents, or 0.1%, to $ 76.89 a barrel.

Brent is on track to end the year up 53%, while WTI is heading for a 58% gain, the strongest performance for the two benchmark contracts since 2009, when prices soared more than 70%. Both contracts touched their 2021 peak in October with Brent at $ 86.70 a barrel, the highest since 2018, and WTI at $ 85.41 a barrel, the loftiest since 2014.

Global oil prices are expected to rise further next year as jet fuel demand catches up.

However, after rising for several straight days, oil prices stalled yesterday as COVID-19 cases soared to new pandemic highs across the globe, from Australia to the US, stoked by the highly transmissible Omicron coronavirus variant.

With oil hovering near $ 80, the Organization of the Petroleum Exporting Countries, Russia and allies, together called OPEC+, will probably stick to their plan to add 400,000 barrels per day of supply in February when they meet on 4 January, four sources said, as they continue to wind back sharp production cuts implemented in 2020.

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