Crude Oil Settle at Highest Since December 2014 Amid Weaker Dollar

Investing.com – Crude oil prices settle higher as signs of rising US production were offset by ongoing dollar weakness.

On the New York Mercantile Exchange for March delivery rose 63 cents to settle at $66.11 a barrel, while on London’s Intercontinental Exchange, gained 0.07% to trade at $70.47 a barrel.

The number of oil rigs operating in the US jumped by 12 to 759, the highest level since Sept. 1, according to data from energy services firm Baker Hughes, which tracked the seven-day period ending Jan. 26.

That added little to existing fears of rising US output as crude prices settled at their highest since December 2014, supported by ongoing dollar weakness and optimism that both oil demand growth and major oil producers’ output curbs – as part of OPEC-led output-cut deal – would continue to rid the market of excess supplies.

Dollar-denominated assets such as oil are sensitive to moves in the dollar – a decline in the dollar tend to make oil cheaper for holders of foreign currency and thus, raises demand.

US crude output is nearing an unprecedented 10 million barrels per day after the Energy Information Energy Reported Wednesday domestic crude production rose to nearly 9.9 million barrels a day last week. That level is close to an all-time high of 10.04 million barrels per day (bpd) reached in 1970, bringing the US closer to world’s top producers Saudi Arabia and Russia.

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