👀 Ones to watch: The MOST undervalued shares to buy right nowSee Undervalued Shares

Oil Down Over Soaring U.S. Dollar, But Remains Above $70

Published 18/06/2021, 05:53
© Reuters.
LCO
-
CL
-

By Gina Lee

Investing.com – Oil was down Friday morning in Asia but remained above $70-market after the U.S. Federal Reserve projected possible interest rate hikes earlier than expected.

Brent Oil Futures fell 0.79% to $72.50 by 12:36 AM ET (4:36 AM GMT) and Crude Oil WTI Futures slid 0.82% to $70.46.

The dollar has soared in the two sessions after the U.S. Federal Reserve expected possible interest rate hikes in 2023, curbing oil demand.

In the short term, crude demand is increasing as some countries continue their economic recovery from COVID-19 and are easing COVID-19 restrictions. However, the prospective interest rate hikes will impact the growth outlook in the long term and eventually hurt oil demand, Westpac senior economist Justin Smirk told Reuters.

"The near term's all very positive. The question is how much further can it rise, how much scope is there if you're looking at an environment where interest rates are going to rise," Smirk said.

Meanwhile, the U.K. reported 11,007 new infections on Thursday, its biggest daily rise in the number of COVID-19 cases since Feb. 19, compared to 9,055 a day before.

On the supply side, Iranian Deputy Foreign Minister Abbas Araqchi said that talks between Iran and the U.S. to revive the 2015 Iran nuclear deal have come closer than ever to an agreement.

"We achieved good, tangible progress on the different issues .... we are closer than ever to an agreement but there are still essential issues under negotiations," said Araqchi.

"Renewed negotiations have sparked concerns that this would lead to the U.S. removing sanctions, resulting in a flood of oil hitting the market…despite this, fundamentals suggest the market remains tight " ANZ Research analysts said in a note.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.