Oil was down Monday morning in Asia, extending its losses from the previous Friday. The black liquid extended its losses from Friday as the dollar strengthened and the U.S. rig count rose, even as almost a quarter of U.S. Gulf of Mexico output remained shut after Hurricanes Ida and Nicholas.
Brent oil futures were down 0.54% to $74.90 by 10:12 PM ET (2:12 AM GMT. WTI Futures fell 0.75% to $71.28 after rolling over to the November 2021 contract on Sep. 19. Both Brent and WTI futures remained above the $70 mark, however.
The dollar inched up on Monday.
Oil fell alongside a greenback that was near a three-week high on Friday. U.S. data released on the same day showed that September’s Michigan Consumer Expectations and Michigan Consumer Sentiment indexes were at 67.1 and 71 respectively.
Expectations are also mounting that the U.S. Federal Reserve will begin asset tapering later in 2021, with the central bank due to hand down its latest policy decision on Wednesday.
“WTI futures may consolidate over the next few trading sessions until the trajectory of the dollar is a little clearer,” OANDA analyst Edward Moya said in a note.
A rising U.S. rig count also contributed to oil’s downward trend. Baker Hughes said on Friday that the oil and gas rig count rose by nine to 512 in the week to Sep. 17, its highest since April 2020 and double the level from the same time in 2020.
The U.S. Bureau of Safety and Environmental Enforcement said that 23% of the crude output from the Gulf of Mexico, or 422,078 barrels per day, remained offline as of Friday.