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Many residents of the emirate's Al Suyoh community were relocated to hotels after a raging wadi swept across their neighbourhood during the records rains last week
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Oil falls more than 2% on demand fears and strong dollar
Strong dollar weighs as Fed rate decision looms; Supply concerns limit decline; Easing Covid-19 restrictions in China could lend support
The Bin Omar natural gas facility, part of the Basra Gas Company, north of the southern Iraqi port of Basra. Brent crude for November delivery fell $2.24, or 2.5 per cent, to $89.11 a barrel by 1213GMT. US West Texas Intermediate for October dropped $2.32, or 2.7 per cent, to $82.79. — AFP file photo
Oil fell by more than two per cent on Monday, pressured by expectations of weaker global demand and by US dollar strength ahead of possible large increases to interest rates, though supply worries limited the decline.
Central banks around the world are certain to increase borrowing costs to tame high inflation this week and there is some risk of a blowout one percentage point rise by the US Federal Reserve.
“The upcoming Fed meeting and the strong dollar are keeping a lid on prices,” said Tamas Varga of oil broker PVM.
Brent crude for November delivery fell $1.90, or 2.1 per cent, to $89.45 a barrel by 1338GMT. US West Texas Intermediate (WTI) for October dropped $2.57, or three per cent, to $82.54.
A British public holiday for the funeral of Queen Elizabeth limited trade volume on Monday.
Oil also came under pressure from hopes of an easing of Europe’s gas supply crisis. German buyers reserved capacity to receive Russian gas via the shut Nord Stream 1 pipeline, but this was later revised and no gas has been flowing.
Crude has soared this year, with the Brent benchmark coming close to its record high of $147 in March after Russia’s invasion of Ukraine exacerbated supply concerns. Worries about weaker economic growth and demand have since pushed prices lower.
The US dollar stayed near a two-decade high ahead of this week’s decisions by the Fed and other central banks. A stronger dollar makes dollar-denominated commodities more expensive for holders of other currencies and tends to weigh on oil and other risk assets.
The market has also been pressured by forecasts of weaker demand, such as last week’s prediction by the International Energy Agency that there would be zero demand growth in the fourth quarter.
Despite those demand fears, supply concerns kept the decline in check.
“The market still has the start of European sanctions on Russian oil hanging over it. As supply is disrupted in early December, the market is unlikely to see any quick response from U.S. producers,” ANZ analysts said.
Easing Covid-19 restrictions in China, which had dampened the outlook for demand in the world’s second-biggest energy consumer, could also provide some optimism, the analysts said. — Reuters
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