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Highlights
- Crude oil prices tumbled on Thursday.
- Both the benchmarks dropped sharply at the end of the session as traders sold riskier assets including commodities and stocks.
- Consumer inflation data showed that the US prices were rising at a 6.2% y-o-y rate.
Crude oil prices tumbled on Thursday followed by a huge surge in the dollar after Joe Biden's administration stated that it is finding alternate sources to reduce energy costs and broader inflation surge.
January delivery Brent Crude oil futures last traded at US$82.72 per barrel up 0.16%, whereas December delivery WTI crude oil futures traded 0.31% down at US$81.59 per barrel as of 11 November 2021 at 11:56 AM AEDT.
The futures of both the benchmarks dropped sharply at the end of the session as traders sold riskier assets including commodities and stocks, driven by the expectations that central banks will take steps to curb rising prices.
Rising US stocks
Wednesday's consumer inflation data showed that the US prices were rising at a 6.2% y-o-y rate, the fastest in the last three decades. The rise in consumer inflation data boosted the dollar, which usually trades inversely to oil.
The concerns of inflations are rising as the global economies drag from the COVID-19 summer wave that has affected the global supplies, sparking a rally in the US dollar which undermines oil prices. A higher dollar makes oil more expensive for other currency holders.
Crude oil stocks | Source: © Batareykin | Megapixl.com
Joe Biden urged the National Economic Council to reduce energy costs.
Additionally, the inventories in the US rose by 1Mbpd in the most recent week, short of estimates for 2.1 million builds in crude stocks.
Bottom Line
Crude oil prices dip on Thursday due to a rise in the US dollar that makes oil more expensive for other currency holders.
