Oil
prices fell in Asia today, reversing sharp gains in the previous
session, hit by a strong dollar and persistent concerns over a global
supply glut. US benchmark West Texas Intermediate for October
delivery, which expires at the end of the trading day, eased 39 cents
to USD 46.29 in late-morning trade after spiking 4.1 per cent at its
close in New York yesterday. Brent crude for November dipped 37 cents
to USD 48.55 a barrel following a 3.1 per cent surge in London.
"A
resurgent US dollar weighed on crude prices. However, an improved
risk tone could cushion oil prices on the downside," said
Bernard Aw, market strategist at IG Markets in Singapore.
The
dollar climbed after three Federal Reserve presidents put the
argument for borrowing costs the rise by year's end, in a bid to
soothe concerns about the global economy that were stoked by the
bank's decision to hold fire Thursday.
A
strong greenback makes dollar-priced oil more expensive for holders
of weaker currencies, hurting demand and prices. Analysts have said
yesterday's strong price rebound looked more like a technical
correction from heavy losses last week as the fundamentals of a crude
oversupply outrunning demand remained intact. Traders are also
closely monitoring progress on Iran's compliance under a deal with
western powers to curb its nuclear ambitions in return for the
lifting of sanctions that will allow it to export more oil.
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