Oil prices climbed back above $66 per barrel, supported by a softening US dollar that made crude more attractive for international buyers. The rebound comes after a period of weakness driven by concerns over slowing global demand and rising inventories.
A weaker dollar typically benefits commodities like oil, as it lowers the cost for foreign currency holders, boosting demand. Traders have been closely watching shifts in Federal Reserve policy expectations, with recent signs suggesting that interest rate hikes may be nearing an end. This has pressured the dollar, providing relief for crude prices.
Beyond currency moves, supply-side factors have also contributed to oil’s recovery. While demand concerns persist, OPEC+ has remained committed to production cuts, limiting supply and preventing a sharper downturn in prices. Additionally, geopolitical risks in key oil-producing regions continue to keep markets on edge.
Despite the rebound, analysts caution that oil remains vulnerable to further volatility, especially as economic data from major consumers like the US and China continue to influence demand forecasts. Any signs of slowing industrial activity or weaker consumption could limit crude’s upside momentum.
Market participants are also monitoring inventory reports and energy policy developments, which could further shape price movements in the near term. If stockpiles continue to rise or global growth concerns escalate, the recent gains may face renewed pressure.
As WTI stabilizes above $66, traders will be looking for further confirmation of demand resilience and supply adjustments to determine whether the recovery can be sustained or if downside risks will re-emerge.
