BackOil lower in Asian trade on firm dollar
Oil lower in Asian trade on firm dollar
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Singapore: Oil fell in Asian trade Tuesday, weighed down by a firmer dollar and concerns that China might tighten monetary policy to rein in inflationary pressures, analysts said.
New York’s main contract, light sweet crude for December delivery, fell 50 cents to $84.36 a barrel.
Brent North Sea crude for December delivery sank 14 cents to $86.62.
“One of the factors was fears that China would tighten monetary policy to curb inflation," said Ong Yi Ling, an investment analyst with Phillip Futures in Singapore.
“There are lingering concerns about the impact on the commodities market," she said.
Data released last week showed that consumer prices rose at their fastest pace in more than two years in October, reviving worries that Chinese authorities might hike interest rates again.
Chinese spending might be affected if monetary policy is tightened further, and there are some who worry this will slow down China’s appetite for commodities including energy products.
China is a major energy-consuming nation.
Ong from Phillip Futures said the dollar’s overnight rebound was also a factor behind the slide in crude futures.
“The strength of the dollar is playing on crude. They have an inverse relationship," she said.
In late US trade Monday, the euro traded at $1.3582 from $1.3696 last Friday.
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