Oil prices fall as dollar strengthens, interest rate cut expectations postponed
Date
6/10/2024 7:50:35 AM
(MENAFN) Oil prices experienced a decline for the second consecutive session in early Monday trading, influenced by the strengthening dollar and postponed expectations of a cut in US interest rates following robust US jobs data released on Friday.
As per figures, both brent and West Texas Intermediate (WTI) crude futures dropped four cents to USD79.58 and USD75.49 per barrel, respectively, by 0036 GMT.
The strong US jobs data from Friday exceeded expectations, leading investors to scale back their anticipation of a rate cut and resulting in a rise in the dollar's value. This appreciation of the dollar elevates the cost of purchasing commodities, including oil, denominated in US currency for holders of other currencies.
Furthermore, the euro faced pressure amidst uncertainty in the eurozone, particularly after French President Emmanuel Macron's call for early legislative elections in June following his party's defeat in the European Parliament elections to Marine Le Pen’s far-right party.
Market attention also turned towards upcoming meetings of the Federal Reserve (US central bank) and the Bank of Japan scheduled for the current week.
Last week, both Brent crude and West Texas Intermediate crude suffered their third consecutive weekly loss. This decline was attributed to concerns regarding a plan to reduce production cuts implemented by the OPEC+ group starting in October, which raised apprehensions of an increase in global supply.
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