Oil Rises After Softer USD and Lower Inventories

Oil prices rose on Thursday as a weaker dollar made fuel cheaper for holders of other currencies, and on hopes of a last-minute breakthrough that could keep Greece in the euro zone and help avoid a shock to European economic growth.

The dollar fell 0.65 percent to a one-month low against a basket of currencies .DXY after the Federal Reserve disappointed investors who had hoped for a clearer signal on when the U.S. central bank will lift interest rates.

European finance ministers were meeting in Luxembourg on Thursday for what could be the last best chance of a political rescue for Greece after other negotiations collapsed.

“The weak U.S. dollar is certainly one factor which can explain the price strength today,” Carsten Fritsch, senior oil analyst at Commerzbank, told Reuters Global Oil Forum.

Brent crude for August LCOc1 rose $1.09 to a high of $64.96 a barrel before easing to around $64.10 by 9.40 a.m. EDT.

U.S. July crude CLc1 was up 5 cents at $59.97 a barrel.

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