Oil dips after four weekly gains on demand headwinds, dollar
BNN Bloomberg
Oil lost ground after a fourth week of gains as a rallying U.S. dollar and demand headwinds countered warnings from the International Energy Agency of higher prices ahead.
West Texas Intermediate futures dipped below US$82 a barrel on Monday after previously posting the longest run of weekly increases since June. A returning appetite for risk was fueling a greenback rally as stocks rose from Hong Kong to London. Lingering concerns over global inflation and demand for oil products were also a factor.
“Clearly, worries about stuttering economic growth and untamable inflation are capping efforts to push prices higher,” said Tamas Vaga, an analyst at PVM Oil Associates Ltd. “Breaking above the US$90 barrier on Brent will be a tall order in the very near future.”
The IEA warned on Friday that the surprise OPEC production cut announced earlier this month will lead to painful price increases for consumers. The supply curbs that begin in May should further tighten the outlook for the second half of the year, the agency said.
