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Crude oil futures hit 5-week low as stronger dollar weighs

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Forexpros - Crude oil futures extended losses on Thursday, falling to a fresh five-week low as a broadly stronger U.S. dollar and concerns over weakening energy demand from the U.S. dragged down prices.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at USD90.50 a barrel during U.S. morning trade, tumbling 1.6%.

It earlier fell as much as 1.65% to trade at USD90.42 a barrel, the lowest price June 27.

The U.S. dollar was higher against all of its major counterparts after Japanese Finance Minister Yoshihiko Noda confirmed that the government intervened in currency markets for the first time since March to curb the yen's recent sharp gains.

In addition, the Bank of Japan announced additional monetary easing in order to support the Finance Ministry's intervention to weaken the yen.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 1.35% to hit a two-week high of 75.20.

Dollar-denominated oil futures contracts tend to fall when the dollar rises, as this makes oil more expensive for buyers in other currencies.

Meanwhile, concerns that the U.S. economic recovery was stalling continued to weigh after the U.S. Department of Labor said earlier that the number of individuals filing for initial jobless benefits last week eased down by 1,000 to a seasonally adjusted 400,000, confounding expectations for an increase to 406,000.

However, the previous week's figure was revised up to 401,000 from 398,000.

Oil traders have been paying close attention to readings on U.S. employment levels for signs that people are returning to work, thus driving more and using more energy.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for September delivery sank 2% to trade at USD110.97 a barrel, up USD20.47 on its U.S. counterpart.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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