Oil prices have increased by more than 1% after the dollar slumped against Japan’s yen, stimulating fuel demand.
Brent crude futures LCOc1 were up 1% and traded at $46.29 per barrel, while the US crude futures CLc1 were also up more than 1% at $45.25, Reuters reported.
A fall in the dollar by more than 7% against the yen will make it cheaper for countries holding other currencies to purchase dollar-denominated commodities, driving demand.
However, the rising prices were capped by increasing production in the Middle East and also due to fears over China’s economic health following weak factory activity in April.
The news agency reported Barclay’s as saying that China’s oil demand increased by 180,000bpd during the first quarter of 2016.
Regarding production, oil shipments from southern fields of Iraq were at an average of 3.364 million bpd in April, representing an increase from 3.286 million from March.
During April, Saudi Arabia’s production stood at 10.15 million bpd.
After lifting of international sanctions in January, Iran is increasing production to almost two million bpd.