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Oil Prices Tumble on Strong Dollar and Fed Rate Hike Worries, Dragging Demand

On April 17th, crude oil futures closed more than 2% lower as the market was weighed down by a strong dollar and concerns over continued interest rate hikes by the Federal Reserve (Fed), which could impact the economy and demand for oil.

WTI crude futures were down $1.69, or 2.05%, closing at $80.83 per barrel, while BRENT crude futures were down $1.55, or 1.8%, settling at $84.76 per barrel.

The strength of the dollar, as reflected by the dollar index against a basket of six major currencies, rose 0.48% to 102.1082 overnight. This made crude oil contracts, which are priced in dollars, more expensive for investors holding other currencies, putting pressure on demand.

Concerns over the Fed’s potential interest rate hikes also impacted the oil market, with the latest CME Group’s FedWatch Tool indicating that 88.1% of investors expect a 0.25% interest rate hike to a range of 5.00-5.25% at the upcoming May 2-3 meeting. Only 11.9% of investors anticipate the Fed maintaining interest rates at 4.75-5.00%. These worries of higher interest rates have raised concerns about the potential impact on the economy and subsequent demand for oil.

Furthermore, oil prices were also affected by news reports that Iraq may resume oil exports from Kurdistan via Turkey, after recently announcing a suspension of approximately 450,000 barrels per day of oil exports from Kurdistan via Turkey.

Investors are also closely watching the upcoming weekly US crude stock report by the US Energy Information Administration (EIA), scheduled to be released on Wednesday at 9:30 p.m. Thai time, for further insights into the oil market and potential impacts on prices.

The combination of a strong dollar, concerns over Fed rate hikes, and news of potential changes in oil exports has contributed to the decline in oil prices, with investors closely monitoring these factors for future market movements.

The Spot Market is Open

Tuesday, April 18, 203

Updated at


Crude Oil




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