Oil Prices Edge Lower Amid Oversupply Worries and Stronger Dollar

2024-11-15 | Current Affairs , Oil

Today’s News

Oil prices dipped slightly on Friday as oversupply concerns and demand uncertainties—driven in part by a strengthening dollar—outweighed a sharp drop in U.S. fuel stockpiles. Brent crude futures fell 30 cents, or 0.41%, to USD 72.26 a barrel, while U.S. West Texas Intermediate (WTI) dropped 25 cents, or 0.36%, to USD 68.45 as of 0105 GMT. 

Oil prices dipped Friday morning as oversupply concerns and a stronger dollar outweighed a sharp drop in U.S. fuel stockpiles. 

Image Source: BBC News
Oil prices dipped Friday morning as oversupply concerns and a stronger dollar outweighed a sharp drop in U.S. fuel stockpiles. 
Image Source: BBC News 

For the week, Brent is on track for a 2.2% decline, and WTI is set for a 2.7% decrease. The Energy Information Administration (EIA) reported a 2.1 million-barrel increase in U.S. crude inventories last week, well above analyst forecasts of a 750,000-barrel rise.  

In contrast, gasoline stocks fell by 4.4 million barrels, hitting their lowest level since November 2022, defying expectations of a 600,000-barrel increase. Distillate stockpiles, including diesel and heating oil, also unexpectedly dropped by 1.4 million barrels. 

ANZ analyst Daniel Hynes noted, “Signs of stronger demand supported oil prices.” However, Hynes pointed out that the market’s focus on oversupply and weak demand outlook exerted downward pressure. 

The International Energy Agency (IEA) projected a global oversupply by 2025, even if OPEC+—comprising the Organization of the Petroleum Exporting Countries and allies like Russia—continues output cuts. Rising production from the U.S. and other non-OPEC producers is expected to exceed sluggish demand. 

Adding further pressure, the dollar surged to a one-year high on Thursday, marking a fifth consecutive daily gain spurred by higher yields and Donald Trump’s election win. A stronger dollar typically makes oil more expensive for international buyers, potentially lowering demand for dollar-priced crude. 

Other News

Trump Team Targets EV Tax Credit Cut, Aiding Tesla 
Trump’s transition team aims to end the USD 7,500 EV tax credit, a move that may boost Tesla while impacting competitors like GM and Ford relying on subsidies for their EV rollout. 

Dollar Hits Year-High on Powell’s Hawkish Tone 
The U.S. dollar strengthened to one-year highs after Fed Chair Jerome Powell hinted at delaying rate cuts, lifting Treasury yields and dampening hopes for December easing.  

Dollar Poised for Best Week Since September 
The dollar surged to a one-year high, gaining 1.8% this week, as Fed Chair Powell’s cautious tone on rate cuts and inflation expectations under Trump boosted the greenback.


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