West Texas Intermediate and Brent oils fell as a stronger dollar curbed the appeal of commodities to investors looking for a store of value. Diesel tumbled to the lowest level in more than two year on ample supply.
Crude futures dropped 1.4 percent in New York and 1.3 percent in London. The dollar reached a six-year high against the yen after the Federal Reserve increased its outlook for interest rates. U.S. stockpiles of distillate fuel, a category that includes diesel and heating oil, rose last week, government data showed yesterday. Supplies of gasoil, distillate’s European equivalent, gained in Europe’s Amsterdam-Rotterdam-Antwerp oil-trading hub, PJK International BV said today.
“Yesterday’s Fed statement and news conference have been examined closely and are having an impact on the dollar,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund that focuses on energy, said by phone. “This is propping up the dollar and putting downward pressure on commodities.”