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Oil prices decline as stronger dollar weighs

Published 11/06/2015, 14:48
Updated 11/06/2015, 14:50
© Reuters. Crude oil futures edge lower as stronger dollar weighs
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Investing.com - Crude oil futures slumped on Thursday, as the U.S. dollar rallied sharply after upbeat retail sales data added to expectations for higher interest rates later this year.

On the New York Mercantile Exchange, crude oil for July delivery shed 73 cents, or 1.19%, to trade at $60.70 a barrel during U.S. morning hours after hitting a daily low of $60.47.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.8% at 95.34, moving off overnight lows of 94.30.

The U.S. Commerce Department said that retail sales increased by 1.2% last month, beating expectations for a gain of 1.1%, while core retail sales, which exclude automobile sales, rose by 1.0%, compared to forecasts for a 0.7% increase.

A separate report showed that the number of individuals filing for initial jobless benefits increased by 2,000 to 279,000 last week. Analysts had expected initial jobless claims to remain unchanged at 277,000 last week.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for July delivery hit an intraday low of $64.75 a barrel before recovering to trade at $65.90, down 80 cents, or 1.24%.

In its monthly report released earlier in the session, the IEA said that global oil demand is forecast to increase by 1.4 million barrels a day this year, raising its projection from last month by 300,000 a day.

The IEA also said that oil supplies from the Organization of the Petroleum Exporting Countries rose by 50,000 barrels in May from a month earlier to 31.33 million barrels per day, the highest level since August 2012, due to increasing output from Saudi Arabia and Iraq.

Meanwhile, the spread between the Brent and the WTI crude contracts stood at $4.05 a barrel, compared to $4.27 by close of trade on Wednesday.

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