Global oil prices rise as dollar weakens

MANILA: Oil prices went up on Thursday as the dollar weakened, but further price increases were restrained by concerns about weak demand brought on by a global economic slowdown.

At 9:44 a.m. local time, the price of international benchmark Brent crude was $78.80 per barrel, 1.23% higher versus the previous trading session's closing price of $77.84 per barrel.

American benchmark West Texas Intermediate (WTI) traded at $73.81 a barrel at the same time, up 1.33% from the previous session's closing price of $72.84 per barrel.

By encouraging traders to use other currencies, the US dollar's declining value supported higher oil prices. Strong market demand is further fueled by a weaker dollar.

Fears of a global recession also caused a decrease in demand expectations. Concerns about weaker demand increased, particularly in light of comments made by International Monetary Fund (IMF) Managing Director Kristalina Georgieva that one-third of the world's economies are predicted to experience recession this year.

Rising COVID-19 cases in China, which are preventing further price hikes, reinforce low demand fears as well.

Concerns about demand were heightened by the fact that China, the second-largest economy in the world, significantly increased its first batch of 2023 export quotas for refined oil products, a hint that the country anticipates lower consumption.

Photo from Shell

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