3/20/2024

Oil declines after reaching highs

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ХОЧЕШЬ УЗНАТЬ КАК ЗАРАБАТЫВАТЬ НА НОВОСТЯХ?

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Key points:

  • Oil futures contracts fell on Wednesday after a period of gains.
  • The strengthening of the US dollar makes oil less attractive to investors who prefer other currencies.
  • American oil reserves, contrary to expectations, decreased.

On Wednesday, the price of oil futures contracts fell. This was facilitated by a number of factors, including:

  • Strengthening of the US dollar. A strong dollar makes oil investments less attractive to investors who prefer other currencies.
  • Fixation of profit. After reaching multi-month highs in the previous session, traders decided to take part of the profits by reducing investments in commodity assets.

May Brent crude futures fell 28 cents (0.3%) to $87.10 a barrel. April U.S. crude oil futures WTI, which expires on Wednesday, fell 47 cents (0.6%) to $83.00 a barrel. The more active May WTI contract was worth $82.41 a barrel, down 32 cents.

Thus, the oil market is experiencing a correction after a period of growth.

Strong dollar puts pressure on oil prices

Buying sentiment in Asia drove the US dollar index higher, hitting a five-day high. This was facilitated by the publication of macroeconomic data indicating the stability of the American economy. A rise in the price of the dollar negatively affects the demand for oil from investors using other currencies.

The focus of market participants is on the Federal Reserve’s interest rate decision, which will be announced later on Wednesday. The trajectory of the rate until the end of the year largely depends on it.

It is worth noting that following the results of the previous session, Brent and WTI quotes reached their highest levels since the end of October.

US oil reserves have fallen again

The American Petroleum Institute recorded a decline in US crude oil and gasoline inventories last week, according to sources. At the same time, there was an increase in distillate reserves. Analyst forecasts called for an increase in inventories of 10,000 barrels over the same period.

ХОЧЕШЬ УЗНАТЬ КАК ЗАРАБАТЫВАТЬ НА НОВОСТЯХ?

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