Oil futures edged up on Wednesday to near $40 per barrel as a weaker dollar spurred interest in riskier assets and the International Energy Agency said expectations for a deluge of oil from Iran were misplaced.
Brent futures LCOc1 climbed 71 cents to $39.85 a barrel as of 1340 GMT after settling down $1.13 in the previous session.
U.S. crude CLc1 rose 77 cents to $39.05 a barrel after ending Tuesday down $1.11.
The dollar index .DXY fell, after slipping to an eight-day low in the previous session on dovish comments by U.S. Fed Chair Janet Yellen about possible interest rate rises.
A weaker dollar makes greenback-denominated commodities cheaper for holders of other currencies.
“One of the main reasons for Yellen’s dovish stance is the low oil price and she made a direct reference to it,” said Olivier Jakob from Petromatrix consultancy.
“For Yellen, low oil prices are not only contributing to low inflation expectations but they are a threat to global economic growth due to the financial stress they are imposing on oil-producing economies,” Jakob said.