SINGAPORE: Brent crude retained most of its overnight losses and steadied near $102 a barrel on Friday, heading for a third weekly drop in four as a firmer dollar weighed, although data showing lower crude stocks in the United States kept a floor under prices.
Oil prices on both sides of the Atlantic fell nearly $1 on Thursday as a surprise cut in interest rates by the European Central Bank led to a spike in the US dollar, making it more expensive for holders of other currencies to buy the dollar-denominated commodity.
Brent was trading 20 cents higher at $102.03 a barrel by 0652 GMT, after settling down 94 cents.
US crude was up 28 cents at $94.73 a barrel, after closing down $1.09 on Thursday. Both benchmarks were on track to end the week with a loss of more than 1 percent.
"ECB monetary policy generally has a very muted impact on commodity prices
. The impact is mostly through the dollar," said Mark Keenan, head of commodities research Asia at Societe Generale.
Keenan, however, added that the "economic slowdown in Europe has been a downside risk to commodity markets, so the action is good in the sense that the European situation is being addressed", suggesting the boost to the economy and increased liquidity may ultimately support risk assets, including oil.
Investors are now waiting for US jobs data for clues on the outlook for demand in the world's biggest oil consumer.
US crude oil stocks fell 905,000 barrels last week, while gasoline stocks dropped 2.3 million barrels, Energy Information Administration (EIA) data showed. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 385,000 barrels.
Comments
Comments are closed for this article.