Oil prices down amid strong US dollar, weak economic data from China

By Duygu Alhan

Oil prices fell on Friday with strong US dollar and weak economic data from China, which triggered demand concerns, while wildfires near Canada's large oil fields support upward price movements.

International benchmark Brent crude traded at $84.55 per barrel at 10.47 a.m. local time (0747 GMT), a decrease of 0.65% from the closing price of $85.11 per barrel in the previous trading session.

The American benchmark West Texas Intermediate (WTI) traded at $80.49 per barrel at the same time, a 0.99% fall from the previous session that closed at $81.30 per barrel.

Oil prices decreased due to the strong US dollar, which ramped up prices for non-US currency holders and discouraged investors.

The US dollar index rose by 0.10% to 104.27 at 10.25 a.m. local time (0725 GMT), compared to the previous trading session, after stronger-than-expected data on the US labor market and manufacturing industry.

The higher US dollar curbs oil demand and supports price declines.

Meanwhile, weak economic data from China, the world's largest crude importer, continues to put downward pressure on oil prices, supporting market players' demand fears.

According to data released by the National Bureau of Statistics, China's economy expanded by 4.7% in the second quarter of the year. The growth rate was lower than the forecast of 5% and below the government's target of around 5% for this year.

Meanwhile, concerns that the forest fires in Canada could damage crude supply by spreading to oil fields have limited downward price movements.

Market players' growing concerns that the fires could put oil production in the country at risk by spreading to the US, the world's largest oil-consuming country, supported price rises.