Oil slumps on dollar strength, cooling consumer sentiment

Oil slumps on dollar strength, cooling consumer sentiment

Oil slid by the most in three weeks as a stronger dollar and weak US economic data stoked concerns over an economic rebound. Futures in New York tumbled 2.3% after a rally in oil earlier in the week pushed the benchmark into overbought territory. The US dollar strengthened, reducing the appeal of commodities priced in the currency. US consumer sentiment cooled more than forecast in January and other economic data such as sluggish retail sales and producer prices also portray the obstacles still facing the country as it emerges from the pandemic. Meanwhile, President-elect Joe Biden said he will ask Congress for $1.9 trillion to fund immediate relief for the US economy that has been pummeled by the pandemic. But the large price tag and inclusion of initiatives opposed by many Republicans set up the aid package for a drawn out legislative battle. "We've had a lot of strength in a number of different markets and now we're getting a pullback,“ said Bill O'Grady, executive vice president at Confluence Investment Management in St Louis. Ultimately, oil markets need "driving to go up. If people have money and no place to spend it, it doesn't make