There was a sharp drop in oil prices on Tuesday after a four-day winning streak of gains. Concerns about rising global supplies as OPEC weighs production cuts supported the fall of the prices.
Brent crude futures were at $65.52 a barrel, falling 1 dollar and 17 cents or 1.77%. Further, U.S. (WTI) crude futures were at $56.19 per barrel, down 1 dollar and 1 cent, or 1.77%, from their last close.
Oil prices are around a quarter below their peaks in October weighed down by surging supply and a global trade slowdown. U.S. crude production has soared almost 25% this year, to a record 11.7 million barrels per day.
OPEC is pushing for a supply cut of 1 million to 1.4 million bpd. The IEA, however, warned OPEC and other producers of the “negative implications” of supply cuts.
Forex – Commodities – Sharp drop in oil prices on OPEC production cuts
The euro fell from a 2-week high on Tuesday following a world stock markets selloff. In addition, nervousness about Italian banks fed through to the single currency, while boosting the Swiss franc and Japanese yen.
The euro dropped 0.2% to $1.1430 below a two-week high of $1.1472 reached earlier.
The safe-haven Japanese yen added 0.1% to 112.46. The Swiss franc gained as much as 0.4% versus the euro to 1.1339 francs before easing slightly.
Against its major traded rivals, the dollar index edged higher, up 0.1% to 96.297, off its weakest in a fortnight.
The Australian dollar skidded more than 0.5% before recovering slightly to trade at $0.7271. Aussie fell 0.3% on the day, pushed lower by fears of Chinese economic slowdown.
Sterling rebounded off earlier lows on Tuesday after Bank of England Governor Mark Carney gave his backing to a Brexit deal. However, the gains were tiny in a market wary of further Brexit deal developments.
The pound rebounded 0.1% to $1.2856, and 0.3% above a low of $1.2821. It hit a two-week low of $1.2725 reached last week.
Sources: Reuters, CNN money, BBC
PLEASE NOTE The information above is not investment advice.