Brent closes 3% lower after 5-session rise

Oil drilling rigs

Oil closed lower today, March 7, after recording gains over the past five sessions. Prices came under pressure from a stronger dollar, and as investors assessed the possibility of an interest rate hike in US and demand outlook.

International benchmark Brent crude slumped 3.4% to close at $83.29 a barrel. West Texas Intermediate (WTI) crude fell 3.6% to $77.58 a barrel.

The dollar index, which measures its value against a basket of major currencies, rose 1.2% to 105.60 points, at 10:28 pm Makkah time.

Federal Reserve Chairman Jerome Powell said that the US central bank is determined to contain inflation because price instability is not good for the economy.

To achieve this, he hinted at the possibility of raising interest rates higher than expected levels, given that recent data indicates continuing inflationary pressures.

Meanwhile, the US Energy Information Administration lowered its forecasts for Brent and WTI crude prices for this year, to $82.95 and $77.10 a barrel each, respectively, down by 0.8% and 1% from last month's expectations.

Separately, official data showed that China's exports continued to decline during January and February, with weak global demand for Chinese goods.

Data from China's General Administration of Customs revealed that exports fell 6.8% in the first two months compared to the same period a year earlier, after a 9.9% drop in December.