Oil prices fell today as the dollar index reached its peak compared to six major currencies since mid-November, prompting traders to stop buying oil due to heavy prices.

According to Reuters, Brent crude dropped by 16 cents to $106.32 a barrel, while US crude slipped 69 cents to $93.68 a barrel.

Oil traders remain cold to oil’s future after Chinese data revealed on Monday that the economy eased to 7.7% between October and December, from 7.8% in the previous three months and slightly ahead of market expectations for growth of 7.6%.

The data also revealed that oil demand in December stood at 10.06mmbpd, down 7.5% compared with a record high 10.88mmbpd a year earlier, but up 1.2% from November.

"Brent could come under pressure again in near future on expectations of increased supply from the Middle East and North Africa."

China’s oil consumption experienced a rise of 1.6%, or 150,000 bpd, in 2013 compared to previous year and crude processing increased by 3.3% in 2013 to 9.57mmbpd, which was less than the 3.7% growth seen in 2012.

But the Brent could come under pressure again in near future on expectations of increased supply from the Middle East and North Africa.

The government Libya has planned to extricate protesters who have seized eastern ports in next few days, which accounts for 600,000 barrels per day of exports.

Major powers and Iran which moved a step closer resolving a long stand off over Tehran’s nuclear programme, after endorsing a deal that will come into effect on 20 January and the parties are likely to start talks on a final settlement in February.

Energy