Inventory report to show ninth straight weekly rise in U.S. crude supplies
A surging U.S. dollar pushed oil prices at Nymex on Tuesday, 10 March 2015 to their lowest settlement for the month of March, ahead of data that are expected to show a ninth straight weekly rise in U.S. crude supplies.
On the New York Mercantile Exchange, crude for delivery in April settled at $48.29 a barrel, down $1.71, or 3.4%.
The dollar hit multiyear highs against the euro and the yen on Tuesday as traders focused on diverging monetary policy paths between the U.S., where the Federal Reserve is expected to begin raising rates, and the European Central Bank and Bank of Japan, which are maintaining ultraloose monetary policy.
A stronger dollar can weigh on commodities priced in the currency, making them more expensive to users of other currencies.
In a monthly report Tuesday, the EIA lowered its 2015 and 2016 forecasts for West Texas Intermediate crude-oil prices.
The sell-off in the U.S. stock market did mitigate some of the selling pressure in the gold market on Tuesday, as it was a keener “risk-off” day in the market place.
The Euro currency was sharply lower and hit an 11-year low on Tuesday. The Japanese yen hit a seven-year low against the U.S. dollar. The surging greenback has been a major bearish factor for most raw commodity markets, which are priced in U.S. dollars on the world markets.
European bond yields are hovering at or near record lows this week, as the European Central Bank's big bond-buying program (quantitative easing, or QE) kicks in. Many look for the Euro currency to fall to parity with the U.S. dollar in the not-too-distant future.
Among other energy products, Nymex April gasoline fell 5.6 cents, or 3%, to end at $1.818 a gallon. April heating oil finished at $1.814 a gallon, down 2.6 cents, or 1.4%.
April natural gas rose 5.4 cents, or 2%, to $2.732 per million British thermal units, with prices rebounding after suffering a 5.7% decline a day earlier.
