Brent oil trading below $80, US dollar holding down prices

22 March 2010 22 March 2010

BonTrade

Brent oil prices are trading below $80 on Monday in Asia as recent strengthening of the US dollar continues to hold down oil futures and other commodities. London Brent crude oil futures fell 33 cents to $79.55 a barrel on the ICE Futures Exchange.

The US dollar index, measured against a basket of currencies, was up 0.2 percent to around 80.88, above last week’s 79.825 low.

“The overall market fundamentals are still not tight. These, combined with the recent strengthening of the US dollar in the last few months, have been one of the reasons why oil is unable to extend its rally,” said Toby Hassall of CWA Global Markets in Sydney.

“The dollar is nearing major resistance, and it will break out or fail,” Peter Beutel, president of energy adviser Cameron Hanover Inc. in New Canaan, Connecticut, said today in a note. “That could determine trends nearby.”