Brent crude oil fell to a two week low on Monday as a strong dollar and concerns about the United States and Chinese economy pressured prices. The commodity began the week on a low note and traded at $100.66 at 9:41 GMT on Monday morning.
After US Federal Reserve Chairman Ben Bernanke confirmed speculation that the US central bank was planning to ease off on its stimulus program later in the year on Wednesday, Brent began its downward fall. The stronger dollar pulled commodities lower and according to CNBC, analysts expect that over the next three months, Brent could drop to its June 22nd low of $88.49.
Adding to the pressure on oil prices is sluggish demand growth in the world's second largest consumer, China. Data that showed the nation's manufacturing activity was falling has added fuel to concern that the nation will not make its 7.5 percent growth target this year. Despite the nation's apparent lack of growth, Chinese policy makers are unlikely to spend on stimulus as the nation is working to rebalance its economy
Geopolitical tension has kept a floor under Brent prices over the past few weeks and although it has been overshadowed by the Fed announcement last week, many investors are keeping an eye on the situation in the Middle East as American diplomatic relations with some key nations involved in Syrian peace talks are being tested by the Edward Snowden's attempts to find asylum.
Snowden managed to fly from Hong Kong to Moscow despite US requests that he be detained by the Chinese government. Now, as the former US intelligence contractor makes his way to Ecuador, many worry that US/Russian relations could turn icy if the Russian government does not step in and return the fugitive to the US.
BY Laura Brodbeck
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Brent Seen Dropping Further In The Coming Weeks
Published 06/24/2013, 08:31 AM
Updated 05/14/2017, 06:45 AM
Brent Seen Dropping Further In The Coming Weeks
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