Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Oil Majors Fall Amid Strengthening Dollar  

Published 18/06/2021, 18:34
Updated 18/06/2021, 18:34
© Reuters.

© Reuters.

By Dhirendra Tripathi

Investing.com – Shares of integrated oil companies as well as standalone refiners and marketers fell Friday as the dollar strengthened and so did crude prices even though other commodities fell.

The dollar Index, which tracks the greenback against a basket of six other currencies, is on course for the largest weekly gain since September.

A rising dollar makes oil more expensive in other currencies, curbing demand.

Chevron (NYSE:CVX), BP (NYSE:BP) and Marathon Petroleum (NYSE:MPC) fell 2% each and Exxon Mobil (NYSE:XOM) was 1.5% lower. Royal Dutch Shell (NYSE:RDSa) lost 4% in the session underway.

U.S. Federal Reserves’ hawkish tone on Wednesday on inflation has spooked investors even as the central bank ruled out a rate hike until at least 2023. Conflicting data points and breakdown of traditional thumb rules are also causing investor anxiety.

At 1255 ET, U.S. crude Crude Oil WTI Futures was up 0.9% at $71.67 a barrel, while Brent Brent Oil Futures was up 0.5% at $73.47. On Wednesday, Brent settled at its highest price since April 2019, while WTI settled at its highest since October 2018.  

Earlier Friday, OPEC officials received information that indicated U.S. oil output growth will likely remain limited in 2021 despite rising prices, Reuters reported.

Higher oil prices, while being an incentive for all explorers, are of particular significance to U.S. shale gas producers given their cost of production for every barrel is higher and elevated prices make it more attractive for them to extract.   

U.S. producers are instead choosing to focus on capital discipline and investor returns, rather than expanding supply, the OPEC's Economic Commission Board heard, according to a Reuters report.

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.