Oil rebounds from session lows as dollar weakens

By @ibtimes on

Oil rebounded on Thursday in choppy trade, as a weaker dollar pulled crude up off losses struck after the International Energy Agency cut its global demand forecast and China further tightened its bank reserve requirements.

In London, Brent crude for June delivery was up 39 cents at $112.96 a barrel by 12:04 p.m. EDT -- up from a session low of $110.15.

U.S. June crude rose 15 cents at $98.36, having moved up session low of $95.25 hit early.

The dollar came under pressure and the stock market looked like it started to pare losses and we seem to have digested the China reserve requirement hike, said Gene McGillian, analyst, Tradition Energy in Stamford, Connecticut.

In early trade, oil fell more than $2 on both sides of the Atlantic following data showing that U.S. initial jobless claims fell last week. The early tumble drove oil volatility to its highest close since mid-March.

Oil also fell much earlier, when China raised its bank reserve requirement. The tightening move came despite initial signs of slowing in the economy. China is the world's second-largest oil consumer and the source of much of its demand growth.

Around midday in New York, the dollar dipped 0.12 percent against a basket of currencies.. The euro hit a session high against the greenback, with gains accelerating after comments made by European Central Bank policymaker Lee Coene were deemed favoring the single currency.

(This story was corrected in first paragraph to a weaker dollar pulled crude up off losses instead of a stronger dollar...)

(Reporting by Gene Ramos and Robert Gibbons in New York; Editing by David Gregorio)

Join the Discussion