Oil Prices Ease on Strong Dollar, Mixed Global Economic News
Date
6/30/2024 8:23:13 AM
(MENAFN- The Al-Attiyah Foundation) crude prices eased about 1% on Friday on worries that global oil demand growth could be hit by a strong U.S. dollar and negative economic news from some parts of the world. Prices declined despite signs of improving U.S. oil demand and falling fuel inventories that helped boost crude prices to a seven-week high a day earlier. brent futures fell 47 cents, or 0.6%, to settle at $85.24 a barrel, while U.S. West Texas Intermediate crude (WTI) 56 cents, or 0.7%, lower at $80.73. The decline pushed WTI out of technically overbought territory for the first time in four days, while Brent futures remained overbought for a fourth day in a row for the first time since early April. For the week, both crude benchmarks were up about 3% after gaining about 4% last week. The U.S. dollar rose to a seven-week high versus a basket of other currencies with the Federal Reserve's patient approach to cutting interest rates contrasting with more dovish stances elsewhere. The Fed hiked interest rates aggressively in 2022 and 2023 to tame a surge in inflation. The higher rates boosted borrowing costs for consumers and businesses, which can slow economic growth and reduce demand for oil.
Asia Spot Prices Hold Steady Amid Northeast Asia Heat, Nearing South Asia Monsoons
Asian spot LNG prices held steady this week amid higher temperatures in Northeast Asia and the anticipation of the approaching monsoon season in South Asia. The average LNG price for August delivery into north-east Asia was at $12.60 per mmBtu, industry sources estimated. Hot weather across Asia had spurred LNG demand, pushing prices up to a six-month top last week. After grappling with record-high summer temperatures, India's monsoon is advancing after stalling for over a week, with rains set to cover central parts of the country in the coming days, said weather officials. In China, southern provinces issued severe flood warnings due to heavy rains, but areas in the northwest and east experienced record-high temperatures. In Europe, the market has largely shrugged off further news of the EU's planned ban on transshipment of Russian LNG. The European Union agreed on a package of sanctions against Russia, including banning re-exports of Russian LNG in EU waters. In the U.S., gas futures eased 1% to a two-week low on Friday on a rise in output and forecasts for demand to decline in two weeks after the heat wave blanketing much of the country.
By: The Al-Attiyah Foundation.
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