Oil is Falling on The Increase in US Drilling Rigs

Oil prices fell on Monday, September 20, extending losses from last week, after the US dollar jumped to a three-week high and the number of US drilling rigs increased, even though nearly a quarter of US production in the Gulf of Mexico remained shut down after two hurricanes.

Brent crude futures were down 61 cents, or 0.8%, at $74.73 a barrel, after falling 33 cents on Friday.

US Texas crude futures fell 66 cents, or 0.9%, to $71.31 a barrel, after falling 64 cents on Friday.

Oil fell as the dollar approached a three-week high after rallying on Friday on the back of better-than-expected US retail sales data.

This reinforced expectations that the US Federal Reserve will start reducing its asset purchases later this year.

A stronger dollar makes oil priced in it more expensive for holders of other currencies, limiting demand, in addition to the pressure on oil prices from the high number of drilling rigs in the United States.