Oil prices weakening in Asia trade

Oil prices weakening in Asia trade

Tuesday, October 7, 2014 6:47 am

Oil prices fell in Asian trade Tuesday, but analysts said they were being supported by a weakening dollar while dealers await fresh trading cues.

US benchmark West Texas Intermediate for November delivery dropped nine cents to $90.25 while Brent crude for November eased seven cents to $92.72 in afternoon trade.

oil rig in Tioga, North Dakota, USA

oil rig in Tioga, North Dakota, USA

Singapore’s United Overseas Bank said crude prices were kept from falling too far by “dollar weakness” this week.

The US dollar has slipped against other major currencies on profit-taking after surging Friday to multi-year highs against the yen and euro in response to a strong September jobs report.

The greenback stood at $108.64 in afternoon Asian trade Tuesday, slightly down from $108.75 on Monday and much lower than the levels above 110 yen it hit last week.

As oil is traded in the US currency, a weaker dollar makes the commodity cheaper for global buyers, spurring demand and boosting prices.

UOB said investors will next be scrutinising the minutes of a two-day Fed meeting that ended on September 17 for clues about when next year the central bank will raise short-term interest rates.

The three-day annual meetings of the World Bank and the International Monetary Fund that start on Friday in Washington will be also be keenly watched, analysts said.

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