Receive our newsletter – data, insights and analysis delivered to you
  1. News
April 24, 2016

Oil prices drop after traders cash-in recent rises

Oil prices have fallen after traders cashed-in following three weeks of rises, with a strong dollar late last week also contributing.

Oil prices have fallen after traders cashed-in following three weeks of rises, with a strong dollar late last week also contributing.

Front-month Brent crude was down and traded at $44.80 per barrel, while the US West Texas Intermediate (WTI) futures fell 35 cents at $43.38, Reuters reported.

Oil prices dropped due to a strong dollar last week on expectations that Japan will further extend its monetary easing through negative interest rates.

"Still-elevated inventory levels, the return of some disrupted supply, further boosts to Saudi and Iranian supply, and increased non-OECD product exports all have the potential to move prices lower."

A stronger dollar will make fuel imports more expensive for countries using other currencies.

Barclays bank told the news agency: "Still-elevated inventory levels, the return of some disrupted supply, further boosts to Saudi and Iranian supply, and increased non-OECD product exports all have the potential to move prices lower over the next several months, especially if broader macro sentiment shifts."

A fall in oil price also came despite another reduction in the rig count in the US that brings activity down for a fifth straight week.

Content from our partners
Green investment: What gives Scotland multiple advantages
How the North of Tyne region is leveraging its legacy to define its future

Oil services company Baker Hughes said that a total of 343 rigs were drilling for new oil last week, which compares to more than 700 this time in 2015.

Last week, oil prices increased by nearly 5% despite the output freeze proposal between Russia and the Organization of the Petroleum Exporting Countries not being agreed, underpinned by expectations that cutting production in non-OPEC countries would help moderate the oversupplied market.

Related Companies

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Friday. The industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU