PT Equityworld, Jakarta Oil prices trim gains as fears of a rise in US shale gas production cuts will overshadow efforts undertaken exporting countries.
US crude oil price, West Texas Intermediate rose 27 cents to settle at US $ 53.20 at the close of trading on Tuesday, as quoted by CNBC on Wednesday (02/15/2017).
While the price of world oil benchmark, Brent rose 36 cents, and sold at US $ 55.95 per barrel. Brent briefly touch the highest level of US $ 56.46 per barrel.
The rally in early trading yesterday lost power because of the strengthening dollar. The dollar rose after Federal Reserve Governor Janet Yellen stated that the central bank will raise interest rates at the next meeting.
A stronger dollar makes commodities sold in dollars such as crude oil more expensive for other currency.
“Oil prices are usually quite volatile barely budged for two months, the reason for the conflict dynamics in the market,” said Hans van Cleef, senior energy economist at ABN AMRO Bank in Amsterdam.
Organization of Petroleum Exporting Countries (OPEC) and other exporters including Russia have agreed to cut production by nearly 1.8 million barrels per day (bpd) during the first half of 2017 in an effort to rein in excess rhang global fuel supply.
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