Oil prices down in Asian trade
US benchmark West Texas Intermediate (WTI) dipped 11 cents to $49.50 a barrel while Brent shed 33 cents to $59.40 in afternoon trade.
WTI slipped $1.15 and Brent crude dropped 75 cents on Friday after a robust US jobs report sent the greenback soaring.
“As the US dollar continues to rally today, the demand for oil will fall and it is hard to see any respite to the oil market at the moment,” David Lennox, resource analyst at Fat Prophets in Sydney, told AFP.
The US dollar bought 121.00 Japanese yen in Asian trade Monday, up from 120.78 yen late Friday after the release of the February US jobs report.
Despite bad winter weather, the world’s largest economy added 295,000 jobs in February and the unemployment rate fell to 5.5 percent, the lowest level since May 2008.
A stronger greenback makes dollar-priced oil more expensive for buyers using weaker currencies, denting demand and pushing prices lower.
Lennox said downward pressure came US inventories stand at record levels, adding to flush global supplies.
The US Department of Energy last week said commercial crude inventories jumped 10.3 million barrels in the week February 27, reaching new record for the fifth consecutive weak.
Crude prices lost about 60 percent of their value to about $40 between June and late January owing to an oversupply in world markets, a weak global economy and a strong dollar. -AFP