Oil prices fell on Wednesday due to a broader sell-off in financial markets and pressure from a strong dollar
Oil prices fell on Wednesday due to a broader decline in financial markets and a stronger US dollar, while investors assessed the supply outlook. Risk aversion in the markets is leading investors to withdraw from energy markets. Brent and WTI are continuing declines from the previous session.
Brent crude futures fell 6 cents, or 0.1%, to $64.38 a barrel by 04:08 GMT, after hitting a nearly two-week low in the previous session. WTI crude was down 10 cents, or 0.17%, at $60.46.
Asian stocks fell on Wednesday, with market volatility reaching levels not seen since April.
The US dollar index held steady at a three-month high. This suggests that the likelihood of a rate cut at its next policy meeting in December is low, driven by a split within the Federal Reserve board.
A stronger US dollar makes dollar-denominated oil more expensive for holders of other currencies, which can impact demand.
A US interest rate cut typically boosts demand.
Crude oil prices are falling as risk sentiment shifts sharply to negative levels, strengthening the safe-haven US dollar.
Sources citing API figures on Tuesday noted that prices were also pressured after the American Petroleum Institute (API) reported that US crude oil inventories rose for the week ending October 31. The increase in weekly US crude oil inventories suggests a decline in fuel inventories.
Supply concerns continue to weigh on prices. On Sunday, OPEC+ agreed to increase production by a modest 137,000 barrels per day in December.
The group decided to pause further increases in the first quarter of 2026. However, this pause is unlikely to provide significant support to November and December prices.
OPEC added only 30,000 bpd to its production in October; OPEC+ increases were offset by decreases in Nigeria, Libya, and Venezuela.
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