Oil prices slide, hit 9-month lows
A Russian state flag flies on the top of a diesel plant in the Yarakta Oil Field, owned by Irkutsk Oil Company (INK), in Irkutsk Region, Russia March 10, 2019. PHOTO: REUTERS/FILE
Oil prices hit nine-month lows on Monday in choppy trade, pressured by a strengthening dollar as market participants awaited details on new sanctions on Russia.
Brent crude futures for November settlement fell by $1.09, or 1.3%, to $85.06 a barrel by 1558 GMT. The session low was $84.51, the lowest since January 14.
US West Texas Intermediate (WTI) crude for November delivery dropped by 90 cents, or 1.1%; its session low was $77.21, the lowest since January 6. Both contracts had risen early in the session after slumping by about 5% on Friday.
The dollar index hit a two-decade high against a basket of six currencies, pressuring demand for oil which is priced in the US currency. The impact of a strong dollar on oil prices is at its most pronounced in more than a year, Refinitiv Eikon data shows. “It’s hard for anyone to expect oil will recover in the wake of a greenback this expensive,” said Bob Yawger, Director of Energy futures at Mizuho.
Disruption from the Russia-Ukraine war also hit the oil market, with European Union sanctions banning Russian crude set to start in December along with a plan by G7 countries for a Russian oil price cap looking set to tighten supply.
Published in The Express Tribune, September 27th, 2022.
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