U.S. Crude Oil Rises as Dollar Tumbles

On Friday, the U.S. crude oil increased in subdued trade as the dollar fell to a three-year low, with many Asian markets closed for the Lunar New Year holiday.

The March delivery for NYMEX crude went up 0.5 percent, or 29 cents, at $61.63 a barrel, after touching a one-week high of $61.82. This week, the contract has gain 4 percent after losing almost 10 percent last week.

U.S. crude oil increases on Friday, as the dollar falls. 

Meanwhile, the Brent crude futures in London increased 0.5 percent, or 30 cents, at $64.63 after settling down 3 cents. Brent fell more than 8 percent last week, but it went up almost 3 percent this week.

“Oil is getting support from a rebound in global stock markets and a weak dollar, but the upside is limited due to a projection for rising U.S. production,” Tomomichi Akuta, a senior economist, stated. “The market is quiet due to a slew of holidays in Asia.”

The dollar, on the other hand, dropped to a three-year low against a basket of currencies. When the dollar is weak, it often boosts the prices of oil and other dollar-denominated commodities.

However, Asian shares prolonged their recovery from two-month lows into a fifth day on Friday as well, as the market volatility gauge of Wall Street went down, although the financial markets in China and Southeast Asia are closed due to the holiday.

According to Suhail al-Mazroui, UAE energy minister, the oil producers led by Russia and Saudi Arabia, are aiming to draft a deal on a long-term alliance at the end of 2018.

Meanwhile, OPEC and non-OPEC producers have been restraining production by a total of 1.8 million barrels per day in a proposal to sustain prices under a deal that will expire by the end of this year.

A data showed that India imported a record of 4.93 million barrels per day last month to feed its expanded refining capacity and to meet its increasing demand.

Earlier this week, oil won sustenance after Khalid al-Falih, Saudi Arabia energy minister, stated that OPEC is hoping to keep limiting the crude output to leave the market tight.

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