Seoul: Oil dipped on Wednesday, 30 April, a day after the rallying dollar sparked the market’s sharpest fall in four weeks, as traders waited to see whether the US Federal Reserve would signal an end to its interest rate cuts.
Prices are also under pressure after Nigerian unions started talks with Exxon Mobil Corp to end a six-day strike that shut in 800,000 barrels per day (bpd) of production, and on expectations of a rise in weekly US crude stocks.
US light crude for June delivery lost 6 cents to $115.57 a barrel by 0615 GMT, deepening Tuesday’s more than $3.00, or 2.6%, slump to stand well below Monday’s $119.93 record high.
London Brent crude shed 2 cents to $113.41 a barrel.
The Federal Reserve is expected to make a modest quarter-point cut in interest rates at Wednesday’s meeting, but traders are also expecting it to signal a pause in its rate-cutting campaign, supporting the battered dollar.
Ahead of the Fed decision, traders will be looking towards weekly US inventory data for signs of gasoline stocks extending their recent steep declines ahead of the summer driving season, and whether crude inventories keep steady despite OPEC curbs.
Analysts expect a small 300,000 barrel rise in crude stocks last week, but a 700,000-barrel decrease in gasoline, a Reuters poll showed
Venezuela’s state-run PDVSA, said its operations were not affected by a blackout on Tuesday that hit large swathes of the country including crude-producing regions.
In Nigeria, government-mediated negotiations between unions demanding higher wages and improved conditions and Exxon Mobil ended on Tuesday without reaching agreement, but a union leader said talks should resume on Wednesday.
Talks between workers and management at Britain’s Grangemouth refinery, which supplies 10% of the UK’s gasoline, have produced a proposal that could resolve a dispute over pensions that led to a two-day strike at the weekend.