2024-11-14 07:39:29 :
(Bloomberg) — Oil prices steadied after hitting a month low on Wednesday as a surge in the dollar weighed on the commodity and worries about rising demand clouded the price outlook.
Global benchmark Brent crude is near $72 a barrel, while West Texas Intermediate is trading above $68 a barrel. The dollar has risen to its highest level in two years after Donald Trump won the election. This makes raw materials, priced in U.S. dollars, more expensive for most buyers.
China’s weak profile in global oil markets was underlined mid-week, with the U.S. Energy Information Administration saying India has become the main source of demand growth in Asia as consumption slumps in China due to a slowdown in China’s economy and rising penetration of electric vehicles. The International Energy Agency will release further market analysis later on Thursday.
Crude oil prices have traded weekly gains and losses since mid-October as traders weigh OPEC supply moves, U.S. monetary policy and risks to oil demand growth, especially from China. There are widespread concerns that global markets will turn to oversupply next year, with Morgan Stanley this week lowering its price forecasts, citing the weaker outlook.
Charu Chanana, chief investment strategist at Saxo Capital Markets Pte Ltd in Singapore, said, “Despite increased bets on rate cuts by the Federal Reserve, the resilience of the U.S. economy has kept the dollar strong, putting pressure on oil prices.” She said that in Demand concerns remain after OPEC cut its growth forecast and as traders digest what the coming Trump presidency could mean for China’s prospects.
The American Petroleum Institute reported that U.S. crude inventories fell by 800,000 barrels last week, including a 1.9 million barrel drop at the Cushing hub in Oklahoma, according to a document seen by Bloomberg.
The Middle East is also in focus. According to the Washington Post, Israel is busy preparing a ceasefire agreement in Lebanon as the government adjusts to the prospect of Trump returning to the White House.
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