SINGAPORE- Oil prices edged lower on Wednesday, as a stronger dollar curbed investor appetite while traders took some money off the table after benchmarks rallied to multi-month highs in the previous session.
Brent crude futures for May delivery fell 16 cents, or 0.2 percent , to $87.22 a barrel. US West Texas Intermediate futures for April delivery which expire on Wednesday’s settlement, fell 31 cents, or 0.4 percent , to $83.16 a barrel. The more active May WTI contract was at $82.55 a barrel, down 18 cents.
“Profit-taking could be a reason for the downside movement today,” Auckland-based independent analyst Tina Teng said, adding that the recent price rally has been supported by improving demand outlook and signs of supply reduction.
Weighing on Asian buyer sentiment, the US dollar index =USDclimbed higher for a fifth-straight session after recent data pointed to a resilient US economy.
A stronger dollar makes oil more expensive for investors holding other currencies, dampening demand.
Traders looked ahead to the Federal Reserve’s interest rate announcement later on Wednesday for signs of its rate path for the rest of the year.
Both Brent and WTI settled at their highest levels since late October in the previous session as market participants assessed the impact on crude and petroleum supplies from Ukrainian drone attacks on Russian refineries.
