Commodities
Home›Commodities›Energy›Oil rises as dollar weakens and Middle East supply ris…
Oil rises as dollar weakens and Middle East supply risks persist
WTI for September climbed to a 3-week high while gasoline edged lower, and EIA inventories came in mixed for both crude and gasoline.
Crude oil prices rose on Tuesday, supported by a weaker dollar and renewed Middle East tension that is keeping supply risks elevated. According to Yahoo Finance, September WTI crude futures (CLU26) were up 1.42, or 1.67%, as crude hit a 3-week high, while September RBOB gasoline futures (RBU26) fell 0.0122, or 0.37%.
The article pointed to a sharp drop in the dollar index, which fell to a 2.5-month low, as a tailwind for energy. It also cited concern that there is no clear path to resolving conflict in the region, leaving the Strait of Hormuz effectively closed and limiting Middle East crude flows.
Middle East developments cited by Yahoo Finance included the UAE saying it is cutting all economic ties with Iran after accusing Iran of firing ballistic missiles at its territory, and a separate lack of interest from the US in extending an expiring Iran agreement, according to the report. It also referenced fresh Israeli attacks connected to Iran-backed groups and attacks on shipping tied to the Red Sea and the Strait of Hormuz.
The weekly EIA inventory report was described as mixed for crude and gasoline. Yahoo Finance also noted that many Gulf countries can still move shipments through the Strait of Hormuz despite disruptions, and referenced last week’s estimate from US Energy Secretary Chris Wright that 9 million barrels per day crossed the strait over the past seven days, versus expectations of 4 million bpd.
Latest closeWTI crude $82.40 ▲1.4%|Gasoline (RBOB) $2.901 ▼7.3%|Dollar index 99.64 ▼0.3%