London (awp/afp) – Oil prices fell on Friday in the face of cautious guidance from the American Federal Reserve (Fed) on its rates, which boosted the dollar in the middle of the week, a factor weighing on demand from buyers with other currencies.
Around 11:25 GMT (12:25 CET), the price of a barrel of Brent from the North Sea, for delivery in February, fell by 1.13% to $72.06.
Its American equivalent, the barrel of West Texas Intermediate (WTI), also for delivery in February, which is the first day of use as a reference contract, dropped 1.21% to 68.54 dollars.
The recent “strengthening of the dollar is putting “downward” pressure on oil prices,” recall DNB analysts.
On Wednesday, the American central bank lowered its rates by 0.25 percentage points, in line with market forecasts. But it is now only considering two rate cuts next year due to the strength of the American economy.
The dollar soared as a result, and although in slight decline on Friday, it retained a large part of its gains.
However, the rise in the price of the greenback penalizes purchases of crude oil, denominated in this currency.
Later in the session, the Fed’s preferred inflation index, the PCE, is likely to influence expectations about the central bank’s monetary path, and therefore the price of the dollar.
The Central Bank of China (PBoC) for its part left two of its key rates unchanged on Friday, the one- and five-year reference rates for bank loans (LPR).
“China offers little to oil market players” hoping for higher prices, “except the disappointment of a year of unfulfilled stimulus promises and warnings of falling demand “, estimates John Evans, analyst at PVM Energy.
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