Brent oil trading back at $105, weaker US dollar lifts prices

Brent oil futures open today’s trading session back around $105 a barrel as rising world markets lift oil prices higher, however focus on weakness in the US dollar may come back into play, as seen by movements in the ICE US Dollar Index.

Latest Brent Oil Price

In London, Brent crude oil futures for September 2011 delivery was trading at $104.95 a barrel, 07.25 GMT this morning on the ICE Futures Exchange.

ICE US Dollar Index

Meanwhile, The ICE US Dollar Index which tracks the US dollar against six major world currencies, fell to 73.910 on Tuesday, and is currenctly around 74.220. A weaker US dollar lifts both Brent and WTI oil prices, which are traded in dollars. Other commodities including gold also benefit from a weaker US dollar.

The US dollar remains under pressure in currency market trading following a pledge by the US Federal Reserve to maintain its super low interest rates.

“The Fed showed a clear interest rate policy target, and its policy direction is seen to suggest credit easing rather than tightening. But the market now needs fresh news to sell the US dollar further beyond the current levels.” according to Teppei Ino, an analyst at the Bank of Tokyo Mitsubishi UFJ.

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Brent oil trading back at $105, weaker US dollar lifts prices