Oil Prices Dip on Stronger Dollar

In the dynamic world of oil, prices had fallen sharply on December 8, 2017, driven by the U.S. dollar’s appreciation. For most people, it would be one more blip in the dance of global markets; for industry players and consumers, it means a great deal.

Moreover, the greater dollar saw foreseeable responses in oil prices going south. It is Brent crude, which led that pack as the benchmark slipped by 1.5% to $62.20 a barrel and West Texas Intermediate by 1.4%, closing at $56.70 a barrel. The stronger dollar makes oil costlier for any carrier of the rest of the currencies-naturally an inhibitor of demand.

This decline is more than just numbers on a screen. For oil-producing countries and corporations, the dip tests revenues and might impact future production decisions. For consumers, though, it may mean a small bit of relief at the pump with lower fuel prices that can alleviate family budgets at just the right time ahead of the holidays.

According to market analysts, the positives that have strengthened the dollar are the positive US economic data and the anticipation of interest rate hikes by the Federal Reserve. These factors, besides strengthening the dollar, continue to have a great impact on financial markets worldwide. Oil prices most often bear the fall.

Oil is pretty volatile by its very nature. What sends a barrel plummeting one day may send it flying the next, simply because of unexpected shifts in geopolitics, constraints in supply, or unfilled demand.

For the time being, as the tanks get filled or heating bills get budgeted, this slight relief in oil prices is a blessed moment of consolidation in the financial life amidst the inherently unpredictable patterns of most global markets.