Oil prices extended their gains on Tuesday, boosted by continued tensions in Venezuela and renewed tensions between Iran and Saudi Arabia. Despite the price increases resulting from global concerns, the rise was capped by continually increasing output in the United States, Brazil and Canada which is negating the efforts made by OPEC to limit production in order to keep prices high.
Brent crude futures gained 0.80 percent as of 2:29 p.m. HK/SIN, trading at $66.58 per barrel. U.S. WTI futures were up 0.82 percent to $62.57 per barrel.
In the stock markets, investors took cues from Monday’s decline on Wall Street which was led by a 6.8 percent drop in Facebook’s share price. Tuesday’s Asian session was mixed, with Australia’s ASX down 0.39 percent and Japan’s Nikkei 225 down 0.47 percent, while the Shanghai Composite and South Korea’s Kopsi both gained just over 0.30 percent. Investors are closely watching the two-day Federal Reserve policy meeting that is set to begin today and will determine when and whether there will be an interest rate hike. According to the CME Group’s FedWatch Tool, the probability of a rate hike on Wednesday stood at 94.4 percent on Tuesday morning in Asia.
The dollar was mostly steady during Asia’s Tuesday afternoon, reversing recent losses against the yen to trade at 106.25. The dollar continued to struggle against the euro, trading at $1.2343 after the euro was strengthened by a deal about the transition period for the U.K.’s Brexit brokered between the European Union and the U.K. The dollar index was down 0.03 percent to 89.90 .DXY.