Home > Business > Oil ends higher as dollar sees renewed weakness

Oil ends higher as dollar sees renewed weakness

57 Views

Oil futures ended higher Tuesday, with Brent crude resuming a push to the upside as a bounce by the U.S. dollar appeared to lose steam.

West Texas Intermediate crude for February delivery
CL.1,
+1.72%

CLG21,
+1.72%

rose 96 cents, or 1.8%, to finish at $53.21 a barrel on the New York Mercantile Exchange, its sixth straight positive session. March Brent crude
BRN00,
-0.07%

BRNH21,
-0.07%
,
the global benchmark, advanced 92 cents, or 1.7%, closing at $56.58 a barrel after losing ground the previous session. Both benchmarks saw their highest finish since Feb. 21.

Analysts said crude was taking a cue in part from equities, which were firmer after a modest Monday pullback.

“Crude prices are following the broader move into risky assets today,” said Edward Moya, senior market analyst at Oanda, in a note.

“It seems energy traders are just looking for a reason to buy as the macro outlook seems to be very positive once we get past these next few months. Earlier oil was boosted on a weaker dollar, but those declines have been kept in check,” he said.

The ICE U.S. Dollar Index
DXY,
-0.45%
,
which tracks the currency against a basket of six major rivals, fell 0.4% after bouncing late last week and Monday from a 2 1/2-year low. A weaker dollar is seen as a positive for commodities priced in the currency, making them cheaper to overseas buyers.

Analysts said crude remained underpinned by Saudi Arabia’s decision last week to cut its oil output by 1 million barrels a day in February and March, helping to blunt fears about the impact of a continued rise in COVID-19 cases and tougher lockdowns on demand.

Investors have also debated whether a sharp rise in crude prices since late last year could prompt a quick boost in output by U.S. shale producers. The Energy Information Administration’s short-term energy outlook for January, released on Tuesday, however, forecast U.S. output to fall to 11.1 million barrels a day this year, unchanged from its previous projection.

Production dropped to 11.3 million barrels a day in 2020 from a record 12.2 million barrels a day in 2019. The agency sees production rising to 11.5 million barrels a day in 2022. Production by the Organization of the Petroleum Exporting Countries, or OPEC, is expected to average 27.2 million barrels a day in 2021, up from an estimated 25.6 million barrels a day in 2020, the agency forecast. 

February natural-gas futures
NGG21,
-0.29%

rose 0.6 cent, or 0.2%, to end at $2.753 per million British thermal units.

February gasoline futures
RBG21,
+2.23%

gained 3.22 cents, or 2.1%, to close at $1.5530 a gallon, while February heating oil
HOG21,
+1.53%

rose 2.32 cents. or 1.5%, to end at $1.5967 a gallon.

Source link

TAGS , , , , , , , , , , , , , , , , ,
Hi guys, this is Kimmy, I started LicensetoBlog to help you with the latest updated news about the world with daily updates from all leading news sources. Beside, I love to write about several niches like health, business, finance, travel, automation, parenting and about other useful topics to keep you find the the original information on any particular topic. Hope you will find LicensetoBlog helpful in various ways. Keep blogging and help us grow as a community for internet lovers.