NEW YORK: Brent crude fell on Wednesday on a larger-than-expected increase in US crude inventories, a firming dollar, and a forecast from the International Energy Agency that oil demand will shrink.
Brent fell $1.13 a barrel to settle at $108.52, below its 200-day moving average of $109.37, a technical support level monitored by traders. US crude futures fell 2 cents to settle at $92.52 a barrel.
Oil prices fell after US crude stocks rose 2.62 million barrels last week, according to weekly US Energy Information Administration (EIA) data. Analysts in a Reuters poll had expected a smaller rise of 2.3 million barrels.
Stocks of distillate fuels also posted a small, unexpected rise, while gasoline inventories fell more than expected, the EIA data showed.
The US dollar rose 0.4 percent against a basket of foreign currencies. A stronger dollar index, which reached a seven-month high on Wednesday, can make oil more expensive for holders of other currencies.
"The dollar remains the big elephant in the room and with the euro (weakening), we expect further dollar strength, which will put pressure on energy prices," said Chris Jarvis at Caprock Risk Management in Boston.
Comments
Comments are closed.