Oil prices fell 1 percent on Monday as rising US output continues to generate concerns among investors. Last week’s data show speculators decided cut bets on oil, suggesting more expected sale. US West Texas Intermediate (WTI) crude futures CLc1 went down by 1.1 percent or 68 cents, settling at $61.36 per barrel while Brent crude futures fell 0.8 percent or 54 cents, to settle at $64.95 per barrel.
Long positions in crude oil fell last week for the first time in three weeks, beckoning hedge funds and money managers to pare bullish bets on US crude. New York Mercantile Exchange’s gross short positions, on the contrary, hit their highest in about a month.
Tradition Energy market research director Gene McGillian warns that oil market’s back and forth flip over increased global demand and production cut is going to support fair prices, but all will likely be negated by the US and North American production.
Canadian dollar could end up losing, despite expecting no potential volatility from North American trade issues once the Bank of Canada raises interest rates less than expected. According to TD Securities’ North American head of currency strategy Mark McCormick, the Canadian dollar is mostly exposed to a global macro and local trade risk level, while the Bank of Canada is the most aggressively priced bank apart from the Fed in the G-10 this year.
The Canadian dollar and Mexican peso are both projected to drop against the US dollar once discussions to remodel the North American Free Trade Agreement fail. In the meantime, Canada is spared from US President Donald Trump’s declaration of 25 percent imported steel tariff and 10 percent aluminum tariff, since Canada is the US’ biggest exporter of both.