Canadian Dollar Falls As Oil Prices Traded Lower

(RTTNews) - The Canadian dollar weakened against other major currencies in the Asian session on Wednesday, as the crude oil prices traded lower after the United States and Venezuela reached an agreement allowing the export of up to $2 billion worth of Venezuelan crude oil to U.S. ports.

Benchmark Brent crude futures dipped 0.7 percent to $60.29 a barrel while WTI crude futures were down more than 1 percent at $56.53.

Trump said Tuesday night that between 30 million and 50 million barrels of oil would be sold to the U.S. at market prices, with proceeds overseen by U.S. Energy Secretary Chris Wright.

The U.S. will use the proceeds "to benefit the people of Venezuela and the United States!" he wrote on Truth Social.

However, analysts were skeptical that Trump's plans would have a major impact on the global supply and American oil companies can fix Venezuela's oil infrastructure.

Traders were also reacting to mixed inventory data from the American Petroleum Institute (API).

While U.S, crude inventories fell by 2.8 million barrels during the week ended Jan. 2, gasoline inventories rose by 4.4 million barrels, and distillate inventories, including diesel and heating oil, increased by 4.9 million barrels over the same period, the API estimated.

In the Asian trading today, the Canadian dollar fell to more than a 2-week low of 1.6168 against the euro and nearly a 2-week low of 113.13 against the yen, from yesterday's closing quotes of 1.6147 and 113.39, respectively. If the loonie extends its downtrend, it is likely to find support around 1.63 against the euro and 111.00 against the yen.

Against the U.S. and the Australian dollars, the loonie dropped to a 4-week low of 1.3827 and more than a 1-year low of 0.9346 from Tuesday's closing quotes of 1.3815 and 0.9307, respectively. On the downside, 1.40 against the greenback and 0.94 against the aussie are seen are seen as the next support levels for the loonie.

Looking ahead, U.S. MBA mortgage approvals data, U.S. and Canada PMI reports for December, U.S. factory orders for October and U.S. EIA crude oil data are slated for release in the New York session.