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MTECHTIPS:-Oil slumps to multi-month lows on supply glut, stronger dollar

MTECHTIPS:-Oil slumps to multi-month lows on supply glut, stronger dollar

U.S. oil futures fell to th

e lowest level in more than four months on Thursday, while Brent traded close to a six-month low, amid perceptions that a global supply glut may stick around for much longer than once anticipated. Crude oil for delivery in September on the New York Mercantile Exchange dropped to an intraday low of $44.47 a barrel, a level not seen since March 18, before trading at $44.64 during U.S. morning hours, down 51 cents, or 1.13%. A day earlier, Nymex oil fell 59 cents, or 1.29%, to close at $45.15 as an unexpected gasoline stock build last week dented the demand outlook. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 98.14 early on Thursday, not far from the previous session’s three-month peak of 98.33. Dollar-denominated oil futures contracts tend to fall when the dollar rises, as this makes oil more expensive for buyers in other currencies. The greenback has been boosted recently by expectations that the improving U.S. economy will prompt the Federal Reserve to raise short term interest rates as early as September. The U.S. Department of Labor said earlier that the number of individuals filing for initial jobless benefits rose by 3,000 last week to 270,000. Analysts had expected initial jobless claims to rise by 6,000 to 273,000 last week from the previous week’s total of 267,000.
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