Oil Rises as USD Retreats

Oil prices rose on Tuesday, helped by the dollar’s first daily fall in a week, but still faced their biggest monthly drop since March in the face of a global supply glut.

Expectations of more Iranian supply following a nuclear deal and concerns that economic worries in China and Europe will weigh on demand have put pressure on oil this month,

stripping 11 percent off the price of crude so far in July.

The dollar was down 0.5 percent, having fallen for the first time in a week against a basket of currencies, but held just shy of three-month highs.

A rising dollar makes it more profitable for non-U.S. investors to sell dollar-denominated assets.

“Macroeconomically, the dollar is strongly bid as people are now pretty much convinced that the Fed will hike rates this year, whether that is in September or December,” BNP Paribas analyst Harry Tchilinguirian said.

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