WTI drops 2% on oversupply worries, tests $ 41

By FXStreet FXStreet (Mumbai) – The black gold prices faced double whammy on Monday, dropping nearly 2% so far, on the back of persisting supply glut worries and a broadly stronger US dollar.

WTI capped below $ 41.65

Currently, WTI trades 1.90% lower at 41.12, bouncing-off a brief dip below 41 barrier. Oil prices halted the recovery from three-month troughs and slipped back into the downward spiral as global supply surplus woes continue to haunt markets.

Markets also shrugged-off a cut in the number of US rigs for an eleventh week out of 12. The US drillers removed 10 oil rigs in the week ended Nov. 20, the biggest weekly decline since late October, bringing the total rig count down to 564, oil services company Baker Hughes report showed.

Analyst at NH Investment and Securities noted, “The burden of carrying high U.S. crude oil inventories is large. The markets would likely rebound only if they saw a fall in U.S. crude inventories, while declining US crude output and seasonal demand provide some support to oil at low prices.”

Add to the negative sentiment around the US oil, the US dollar strengthened to the highest levels since April against its major peers on increased Fed hike …read more

Source:: FX Street