The price of crude oil is back blow $80 U.S. a barrel, and at its lowest level in three weeks, as a stronger U.S. dollar and rate hike expectations exert downward pressure on the commodity.
West Texas Intermediate (WTI) crude oil, the U.S. standard, is currently trading at $77.90 U.S. per barrel, its lowest level since late March.
Brent crude oil, the international benchmark, is trading at $81.89 U.S. a barrel, down about 2% in Asian trading and also at its lowest level since the end of March.
The drop in oil prices comes as the U.S. dollar has experienced its strongest week of trading since late February. A stronger American dollar makes oil more expensive for holders of other currencies.
Oil’s price is also declining as expectations grow for the U.S. Federal Reserve to again raise interest rates by a quarter of a percentage point at its next policy meeting in May.
At the same time, U.S. crude stockpiles fell by 4.6 million barrels as refinery runs and exports rose, while gasoline inventories increased unexpectedly on lower demand, according to the U.S. Energy Information Administration (EIA).
On the supply side, oil from Russia in April is likely to rise to its highest level since 2019, despite Moscow’s pledge to cut output and shipping.
Crude oil prices have slumped this year after peaking above $120 U.S. per barrel in June 2022.