Oil Rises on Weaker USD

Brent crude futures rose toward $66 on Tuesday, lifted by a weaker dollar and the Yemen conflict, but concerns of oversupply weighed on prices amid news of record high output from Saudi Arabia in April and Iraqi plans for record exports in June.

June Brent crude was up 88 cents at $65.79 a barrel by 1352 GMT (9.52 a.m. EDT), easing back from an intraday high of $66.45 a barrel.

June West Texas Intermediate (WTI) rose 58 cents to $59.83 a barrel, after touching $60.55 a barrel earlier in the day.

The dollar was down 0.6 percent against a basket of currencies. Dollar-traded commodities such as oil benefit from a weaker U.S. unit as it makes them cheaper for holders of other currencies.

“We had a strong recovery of the U.S. dollar in the last few trading sessions but we saw a reverse this morning,” said Myrto Sokou, a senior analyst at Sucden Financial. “The weaker dollar is providing support for prices.”

Top global oil exporter Saudi Arabia raised its crude production in April to a record high, feeding its flourishing Asian market share and its own power plants and refineries.

via Reuters

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza