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Weaker dollar, possible producer action buoy oil prices after 4% slump

Published 08/08/2019, 02:01
Updated 08/08/2019, 02:10
© Reuters. Weaker dollar, possible producer action buoy oil prices after 4% slump
LCO
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CL
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* Brent, WTI rebound more than $1/bbl
* Weaker U.S. dollar, talk of more producer action lend
support
* U.S. crude stockpiles unexpectedly rose last week -EIA

By Florence Tan
SINGAPORE, Aug 8 (Reuters) - Oil futures jumped more than $1
a barrel on Thursday amid a weaker dollar, recovering ground
after concerns that a global economic slowdown would hurt crude
demand sparked losses of over 4% in the previous session.
Brent crude LCOc1 had rebounded to $57.52 a barrel, up
$1.29, or 2.29%, from its last close by 0032 GMT, while U.S.
crude futures CLc1 jumped $1.30, or 2.54%, to $52.39 a barrel.
Both contracts hit their lowest levels since January on
Wednesday after a surprise build in U.S. crude inventories added
to worries that the brewing Sino-U.S. trade war could further
dampen demand-growth this year. EIA/S "The U.S. dollar is losing some steam and easing some of the
pressure on oil prices," said Alfonso Esparza, a Toronto-based
senior market analyst at Oanda.
Talk of more action to prop up oil markets from Saudi Arabia
and other producers in the Organization of the Petroleum
Exporting Countries (OPEC) also supported crude prices.
Bloomberg in a report on Wednesday cited a Saudi official
saying that the world's top exporter is in talks with other
producers to take action to halt the oil price slide.
"Trade war rhetoric will continue to guide markets, but the
comments from Saudi Arabia could lead to unprecedented action to
stabilise prices," Esparza said.
"It is hard to imagine what that would look like given how
hard it was to get the OPEC+ to agree to the production limit
agreement, but given the potential free fall from crude if the
trade war continues, no option is off the table."

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