Oil prices fell slightly on Monday due to a stronger U.S. dollar and anticipation of key economic data, including U.S. Federal Reserve updates and payroll reports later in the week.
Brent crude futures dropped 28 cents, or 0.4%, to $76.23 per barrel early Monday morning, after reaching a peak on Friday not seen since October 14, according to Reuters.
U.S. West Texas Intermediate crude dropped 27 cents, or 0.4%, to $73.69 per barrel, following a strong Friday close, the highest since October 11.
The oil market had seen five consecutive sessions of gains, driven by expectations of increased demand from colder weather in the Northern Hemisphere and fiscal stimulus measures by China to boost its struggling economy.
However, a senior market analyst at Phillip Nova, Priyanka Sachdeva, noted in her Monday report that the strength of the dollar is a key concern for investors.
The dollar remained near a two-year high on Monday, and its strength makes dollar-priced commodities, like oil, more expensive for buyers using other currencies.
Investors are closely awaiting economic updates for insight into the US Federal Reserve’s future rate decisions and energy consumption trends.
The minutes from the Fed’s last meeting will be released on Wednesday, followed by the December payrolls report on Friday.
Meanwhile, Saudi Aramco raised crude prices for Asian buyers in February, marking the first increase in three months.
This move comes amid growing concerns about potential disruptions in Iranian and Russian oil shipments, as the possibility of stronger sanctions on both producers continues to hang over the market.
Goldman Sachs forecasts a decline in Iran’s oil production and exports by the second quarter, driven by expected policy shifts and stricter sanctions under incoming U.S. President Donald Trump’s administration.
The investment bank anticipates that Iran’s output could fall by 300,000 barrels per day, dropping to 3.25 million bpd by the second quarter.
The global oil market faces uncertainty due to a projected supply surplus in 2025.
Analysts predict that rising non-OPEC oil supplies will largely offset global demand growth, while the potential for increased U.S. production under President Trump adds to the market’s complexity
