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Oil falls as firm dollar, China economy counter 7-week rally

14 August 2023 09:00 (UTC +04:00)

Oil prices eased on Monday as concerns about China's faltering economic recovery and a stronger dollar weighed against seven weeks of gains on tightening supply from OPEC+ output cuts, APA reports citing Reuters.

Brent crude futures fell 90 cents to $85,91 a barrel while U.S. West Texas Intermediate crude was at $82.28 a barrel, down 91 cents.

Prices slipped as the U.S. dollar index (.DXY) extended gains after a slightly bigger increase in U.S. producer prices in July lifted Treasury yields despite expectations the Federal Reserve is at the end of hiking interest rates.

Oil may be range-bound this week as China's sluggish economic recovery and a stronger U.S. dollar could depress prices, but OPEC+ has indicated it would do whatever it takes to tighten supply and stabilize markets, CMC Markets analyst Tina Teng said.

Supply cuts by Saudi Arabia and Russia, part of the alliance between the Organization of the Petroleum Exporting Countries and their allies, or OPEC+, are expected to erode oil inventories over the rest of this year, potentially driving prices even higher, the International Energy Agency said in its monthly report on Friday.