23 October 2016

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Reuters: Oil prices dip on stronger dollar; rise in U.S. crude stocks data

Crude oil futures fell in early trade on Wednesday as the U.S. dollar held around three-week highs and industry stocks data indicated a build in U.S. crude inventories, Reuters reported. 


International Brent crude oil futures LCOc1 were trading at $48.27 per barrel at 0052 GMT, down 10 cents, or 0.2%, from their previous close, according to Reuters.

U.S. West Texas Intermediate (WTI) crude futures were down 16 cents, or 0.4%, at $46.19 a barrel.

A stronger greenback makes dollar-priced commodities like oil more expensive for holders of other currencies and possibly capping demand.

The dollar strengthened after recent hawkish comments by Fed Chair Janet Yellen and Vice Chair Stanley Fischer boosted expectations that a rate hike by the U.S. central bank at its September policy meeting could be on the horizon, Reuters wrote.

"The pullback in commodity prices is likely to continue in the short term with a stronger USD and weaker fundamentals," Australian bank ANZ said in a note.

U.S. crude stocks rose by 942,000 barrels in the week to August 26 to 525.2 million, nearly in line with analysts' expectations for an increase of 921,000 barrels, data from industry group the American Petroleum Institute showed on Tuesday, according to Reuters. 

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