Oil prices continue to fall amid stronger dollar

Oil prices continue to fall amid stronger dollar


The cost of the February futures on Brent blend fell to 36,47 USD per barrel, WTI – up to 35,75 USD per barrel. Earlier, Brent reached the lowest level since July 2004.

MOSCOW, 21 Dec. World oil prices continue to decline, the price of Brent crude oil fell to its lowest level since 2004, amid oversupply in the global market, according to AFP.

As of 12.56 MSK price of February futures for North sea petroleum mix of mark Brent fell by 1.11% to 36,47 USD per barrel. The price of February futures for oil of mark WTI has decreased on 0,85% — to 35,75 USD per barrel. Previously, the price of Brent crude reached the lowest level since July 2004, having gone below $ 36.2 dollar per barrel.

According to analysts, the opinion of which leads the Agency Reuters, pressure on the market have a stronger dollar caused by rising interest rates, the fed, and a larger number of active drilling rigs in the United States.

Last Wednesday, the fed following the meeting for the first time since 29 June 2006 has raised the benchmark interest rate to 0.25-0.5% per annum with a record low of 0-0,25%. Raising rates supported the U.S. currency, which, in turn, put pressure on oil prices. The dollar index (the dollar against a basket of currencies of six major U.S. trading partners) as at 12.57 GMT rose 0.08% to 98,76 item.

The message of the American oil service company Baker Hughes on the dynamics of drilling rigs for the week ended 18 December, also lead to lower oil prices. The number of drilling rigs in the U.S. the season ended, the work week has not changed and amounted to 709 units. In annual terms, this figure dropped to 1166 units, or 62.1 per cent. The number of oil rigs increased by 17 units, or 3,24%, to 541 pieces.

“The growth in the number of drilling rigs, even at low prices shows that the shale oil producers strive to maintain production. Production data reflect the increased oil reserves in the U.S., which reached 491 million barrels, the highest level for this time of year since 1930,” said analysts at ANZ Bank to Reuters.