The demand outlook for oil received a boost on Tuesday after the International Monetary Fund upgraded its forecast for world growth. (Photo by Mario Tama/Getty Images)
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Oil prices fell on Tuesday as a stronger dollar and concerns over central bank rate hikes outweighed a positive outlook for global growth delivered by the International Monetary Fund.
Brent crude, the international benchmark, fell 1.1% to $83.57 a barrel. West Texas Intermediate, the U.S. standard, was down 1.2% to $77.37 a barrel.
Analysts at Saxo Bank said speculators appeared to be cutting positions bought earlier this month after failing to break resistance in the $89 to $90 area for Brent crude last week, hampered by a stronger dollar ahead of the Federal Reserve’s interest-rate decision on Thursday.
A stronger dollar usually weighs on oil prices as it makes the dollar-priced commodity more expensive for holders of other currencies
The demand outlook for oil received a boost on Tuesday after the International Monetary Fund upgraded its forecast for world growth and said a global recession is unlikely.
“On balance the outlook for crude oil demand looks supportive as China recovers while the supply outlook remains uncertain with the upcoming threat to supply from the next round of sanctions against Russian sales of fuel products,” Saxo Bank’s analysts wrote.
Write to Adam Clark at adam.clark@barrons.com
Credit: marketwatch.com