Oil slips slightly on rising dollar

Oil prices saw a slight decrease on Wednesday due to a stronger dollar reducing investor interest and traders cashing in after a recent surge to multi-month highs, Reuters reported.

Brent crude futures for May dropped by 28 cents, or 0.3 per cent, to $87.10 a barrel by 0711 GMT. US West Texas Intermediate (WTI) futures for April, set to expire at Wednesday’s settlement, decreased by 47 cents, or 0.6 per cent, to $83.00 a barrel.

The more active May WTI contract was priced at $82.41 a barrel, down 32 cents.

The rising US dollar index, which has been on an upward trend for five consecutive sessions following data showing a robust US economy, has negatively impacted Asian buyers’ sentiment. A stronger dollar results in costlier oil for investors using other currencies, thereby suppressing demand.

Trade sources informed Reuters on Tuesday that strikes causing a reduction in Russian refining capacity have led to a boost in the country’s crude oil exports.

They predicted that oil exports from Russia’s western ports would rise by nearly 260,000 barrels per day in March, exceeding the initial monthly plan to reach 2.22 million bpd.

Patterson commented that if these disruptions continue, Russian producers might be forced to cut supply if they can’t export all their crude oil. He added that these attacks are currently more beneficial for refined products.

According to sources, the American Petroleum Institute reported a decrease in US crude oil and gasoline stockpiles last week, while distillate inventories increased.

A Reuters survey of analysts anticipated a rise in stocks of approximately 10,000 barrels last week. The US Energy Information Administration is scheduled to release official stockpile data at 1430 GMT on Wednesday.