Oil rates drop driven by strong US dollar
Date
7/15/2024 8:44:01 AM
(MENAFN) Oil prices saw a decline on Monday as the strength of the US dollar made oil more expensive for holders of other currencies, leading to reduced demand and dissuading investors. At 10:57 a.m. local time (0757 GMT), the international benchmark brent crude was trading at USD84.80 per barrel, reflecting a 0.27 percent drop from its previous closing price of USD85.03 per barrel. Similarly, the American benchmark West Texas Intermediate (WTI) was trading at USD80.75 per barrel at the same time, marking a 0.33 percent decrease from its previous session's closing price of USD81.02 per barrel.
In a significant political development, former US President Donald Trump was the target of an assassination attempt during a rally in Pennsylvania on Saturday. This incident occurred just days before he was set to accept the Republican nomination for a third term. The political instability in the US contributed to a stronger dollar, as investors sought safe-haven assets. This upward trend in the US dollar, which saw the US dollar index rise by 0.11 percent to 103.892 at 10:57 a.m. local time (0756 GMT), had a dampening effect on oil demand since a stronger dollar makes oil pricier for those using other currencies.
The robust dollar thus led to a reduction in global oil demand, contributing to the price declines observed. Additionally, ongoing efforts to implement a cease-fire in the Middle East, which is home to the majority of the world's oil reserves, continued to influence oil prices. The combination of these geopolitical and economic factors has resulted in a complex landscape for the oil market, with the interplay of political events and currency fluctuations playing a significant role in shaping price movements.
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