Oil edges lower as strong dollar, economic concerns weigh
(Reuters) Oil prices edged lower on Wednesday, extending losses to a third straight session, as a stronger dollar weighed and economic concerns rose following Britain's vote to leave the EU.
Investors also awaited data on US crude inventories, delayed due to Monday's Independence Day holiday.
Global benchmark Brent futures were down $0.30 at $47.66 per barrel after a 4.1% drop on Tuesday.
US crude traded at $46.35 per barrel, down $0.25. The contract fell 5% to end at $46.60 on Tuesday.
"Oil once again is testing key support levels and the inventory report will be the next focus, especially the level of gasoline inventories," said Ole Hansen, commodity strategist at Saxo Bank in Copenhagen.
He told the Reuters Global Oil Forum that Brent was edging closer to the technical support level of $47 per barrel and US crude was rapidly approaching its support level of $45.80.
The US crude inventory data could change momentum if it shows another stock draw as an indicator that a supply glut is starting to ease.
A Reuters poll showed analysts expected weekly US commercial oil stocks to have fallen for a seventh consecutive week, along with a probable drop in gasoline stockpiles.
They forecast a 2.5 MMbbl draw in crude stocks and a 1.2 MMbbl fall in gasoline inventories.
The API releases its data a day later than normal on Wednesday at 4:30 p.m. EDT (20:30 GMT), while data from the US government's Energy Information Administration (EIA) is delayed to Thursday at 11 a.m. EDT (15:00 GMT).
The US dollar rose against a basket of currencies, trading up 0.1%.
"You have the dollar strengthening, risk aversion rising because of the ongoing Brexit saga and then there are the actual supply and demand aspects to consider," Fawad Razaqzada, market analyst for forex.com, said in a note.
Britain's decision to exit the EU has caused concern about economic growth in the region.
The British pound slumped to a new 31-year low against the dollar early on Wednesday after three UK property funds were suspended in the face of a rush of redemptions from investors fearing a slump in British property values.
The Bank of England also took steps to ensure British banks keep on lending, by lowering the amount of capital banks must hold in reserve, as UK business confidence plunged.
Reporting by Karolin Schaps; Additional reporting by Aaron Sheldric; Editing by Dale Hudson
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