OIL PRICE DECREASE. Price of oil in the world market slipped on Friday (March 15, 2024) due partly to strengthening of the US dollar after the higher-than-expected consumer price inflation report in the US. Expectations that the US Federal Reserve will keep its key rates higher also contributed to this development. (Anadolu)
ANKARA – Oil prices declined on Friday, pressured by a strong US dollar, following higher-than-expected consumer price inflation data and on fears that the US Federal Reserve (Fed) will maintain high rates for longer.
International benchmark Brent crude traded at USD85.02 per barrel at 10.37 a.m. local time (0737 GMT) for a 0.47 percent decrease from the closing price of USD85.42 a barrel in the previous trading session.
The American benchmark West Texas Intermediate (WTI) traded at USD80.92 per barrel at the same time, a 0.42 percent fall from the previous session that closed at USD81.26 per barrel.
The US Bureau of Labor Statistics showed on Thursday that the Producer Price Index (PPI), which measures the change in the price of goods sold by manufacturers, increased by 1.6 percent year-on-year in February against market expectations of a 1.1 percent rise.
The latest PPI marked the largest increase since September 2023.
Ahead of the Fed's meeting on March 20, these figures were released, which raised concerns that the Fed would decide to keep interest rates higher for longer.
With support from the latest data, the US dollar index increased by 0.58 percent to 103.36 on Thursday, aiding the fall in oil prices.
The strong dollar is expected to lower demand by making oil more expensive for holders of other currencies.
Meanwhile, increased demand in the US, the world's biggest oil consumer, and supply concerns stemming from the ongoing conflict in the Middle East and between Russia and Ukraine curtailed price declines.
Geopolitical unrest and the decline in US crude inventories raised global supply concerns, which prompted profit-taking by investors in Friday's early trade and increased pressure on prices. (Anadolu)
