Oil slips on demand worries, strong dollar

0

Content of the article

CALGARY – Oil prices fell on Tuesday, under pressure from a strong US dollar and concerns about weak demand in the United States and Asia, although production disruptions underway on the US Gulf Coast of Mexico limited the losses.

U.S. West Texas Intermediate crude stabilized at 94 cents or 1.4% from Friday’s close at $ 67.35 a barrel, and hit a session low of $ 67.64. There was no settlement price for Monday due to Labor Day in the United States.

Brent crude futures stabilized at 53 cents, or 0.7%, at $ 71.69 a barrel, after falling 39 cents on Monday.

Advertising

Content of the article

John Saucer, vice president of crude oil markets at Mobius Risk Group in Houston, said a stronger dollar and Saudi Arabia’s decision to cut October’s official selling prices (OSP) put pressure on the crude. A strong dollar makes oil more expensive for holders of other currencies.

“People read the Saudi price change as a sign of declining Asian demand and the magnitude of the reduction was larger than expected,” Saucer said.

Saudi Arabia has reduced the price of all grades of crude sold in Asia by at least $ 1 a barrel. The move, a sign that consumption in the world’s leading importing region remains lukewarm, comes as lockdowns in Asia to fight the Delta variant of the coronavirus have clouded the economic outlook.

Data released Friday also showed that the US economy in August created the fewest jobs in seven months, with hiring in the leisure and hospitality industries stagnating amid a resurgence in COVID infections. 19.

Advertising

Content of the article

However, oil prices have found some support in the strength of Chinese economic indicators and the continued disruptions in US supplies due to Hurricane Ida.

China’s crude oil imports rose 8% in August from the previous month, according to customs data, while China’s economy was boosted by unexpected export growth at a faster pace in August.

In the Gulf of Mexico, about 79% of oil production has remained closed, or 1.44 million barrels per day, a US regulator said on Tuesday, more than a week after Ida’s coup. (Additional reporting by Ahmad Ghaddar in London and Yuka Obayashi in Tokyo; Editing by Jane Merriman, Edmund Blair and David Gregorio)

Advertising

In-depth reporting on The Logic’s innovation economy, presented in partnership with the Financial Post.

comments

Postmedia is committed to maintaining a lively but civil discussion forum and encourages all readers to share their views on our articles. Comments may take up to an hour of moderation before appearing on the site. We ask that you keep your comments relevant and respectful. We have enabled email notifications. You will now receive an email if you receive a reply to your comment, if there is an update to a comment thread that you follow, or if a user that you follow comments. Visit our Community rules for more information and details on how to adjust your E-mail The settings.


Source link

Leave A Reply

Your email address will not be published.