3 November 2022 | Other

Strengthening dollar pressures oil, but supply concerns keep prices up

The U.S. dollar is strengthening due to the Fed's hawkish policy choice. Nevertheless, oil prices remain stagnant due to general supply concerns.

According to CMC Markets analyst Tina Teng, the strengthening dollar is putting pressure on oil prices, but some market participants are also likely taking profits after recent gains.

Teng also noted that after Fed officials confirmed a rate hike, the gloomy global economic outlook could continue to have a negative impact on oil futures markets.

Nevertheless, global downside risks to supply remain high.

The European Union embargo on Russian oil supplies comes into effect on December 5, and imports of oil products will be halted in February.

According to ANZ analysts, this will also lead to a supply shortfall among OPEC members over the coming months. Organization of the Petroleum Exporting Countries (OPEC) production fell in October for the first time since June.

On the demand side, Stephen Innes, managing partner working at SPI Asset Management, believes that any signs of easing restrictions imposed because of COVID-19 in China could completely change the current situation.

Company MarketCheese
Period: 25.07.2025 Expectation: 440 pips
AUDCAD gains on technical bounce and improved sentiment in commodity markets
Today at 10:05 AM 27
Period: 25.07.2025 Expectation: 1700 pips
GBPUSD struggles to regain momentum as uptrend breaks
Today at 09:14 AM 25
Period: 25.07.2025 Expectation: 222 pips
Buying natural gas with target at 3.780 amid record heatwaves in US and Asia
Yesterday at 10:49 AM 61
Period: 25.07.2025 Expectation: 15000 pips
ETHUSD rally accelerates as US moves forward with crypto legislation
Yesterday at 10:13 AM 65
Period: 23.07.2025 Expectation: 600 pips
USDCAD gains strength amid dollar rally and falling oil prices
16 July 2025 86
Period: 25.07.2025 Expectation: 1000 pips
Nvidia's return to China pushes shares toward 180 level
16 July 2025 78
Go to forecasts