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April 12, 2016

Oil prices drop as dollar value strengthens

Oil futures traded lower as dollar value strengthened, as well as concerns that a meeting of oil producing nations being held in Doha on Sunday will not curb excess supply.

Oil futures traded lower as dollar value strengthened, as well as concerns that a meeting of oil producing nations being held in Doha on Sunday will not curb excess supply.

The price of Brent crude LCOc1 dipped 34 cents to touch $44.35 a barrel, while price of US crude CLc1 fell by 49 cents to $41.68 a barrel, reported Reuters.

Saudi Oil Minister Ali al-Naimi recently ruled out an outright cut in production of oil, which negatively impacted prices.

"Saudi Oil Minister Ali al-Naimi recently ruled out an outright cut in production."

When asked about any plans to cut Saudi’s oil production, al-Naimi told the al-Hayat newspaper: "Forget about this topic."

Iran’s Oil Minister Bijan Zanganeh is not likely to attend the meeting; instead, the country plans to send a representative.

The country has already indicated that it does not intend to cut production, reported the news agency.

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Furthermore, strengthening of the US dollar also weighed down the prices, as the currency makes dollar-denominated commodities expensive for other countries.

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