(Bloomberg) -- Oil steadied in New York after the biggest plunge since July on a stronger dollar, with concerns over OPEC supply back in focus.
Futures have been whipsawed by the U.S. dollar this week, with a gain on Wednesday helping to drive oil 2.9% lower, the most since July 30. Meanwhile, Iraq may seek a two-month extension to implement compensatory cuts under the output agreement, indicating OPEC’s second-biggest producer won’t be able to curb its production as quickly as previously promised.
Oil’s rally has faltered near $43 a barrel with prices struggling to convincingly push higher as rising coronavirus infections raised concerns about the recovery in consumption. OPEC is also testing the appetite for demand by returning more supply to the market, while Chinese crude purchases are slowing.
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U.S. crude stockpiles fell by more than 9 million barrels last week, according to a report from the Energy Information Administration, but the large draw likely reflected the impact from Hurricane Laura. Output dropped below 10 million barrels a day for the first time since 2018.
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