Stronger Dollar Limits Oil's Rally above $85
Despite yesterday's revived rally, NYMEX crude futures posted a slight loss Thursday as oil traders tightened their purse strings and took safe haven in a resurging dollar.
Helping to prop up oil prices earlier on, China reported that its economy grew at an unexpected rate of 11.9% during the first quarter, or the fastest rate of expansion since 2007, according to a report by Reuters.
However, the upbeat economic news out of China was not enough to spur oil prices toward a new target price of $90 ahead of the May front-month contract's expiry on Tuesday.
Instead, the price of light, sweet crude oil for May delivery met resistance near $86 and ultimately closed its session at $85.51 a barrel.
Likewise, NYMEX gasoline futures and natural gas spot prices at the Henry Hub lost steam on the commodity exchange, settling down to $2.32 a gallon and $3.99 Mcf, respectively.
Today, a stronger greenback weakened commercial support for dollar-denominated commodities, which are riskier to cash holders when the value of the U.S. currency rises.