On Friday, oil managed to fall by over $1 to $78 per barrel, mainly on the back of a stronger Dollar value after the Federal Reserve raised an emergency lending rate and higher-than-anticipated crude inventories across the US.

The Fed's move to hike the discount rate to 0.75% from the previous figure of 0.50%, as a direct result of the improvement in financial market conditions, also managed to drive down US stock futures as a whole, in addition to gold and other commodities.

US crude for March delivery slipped to a new low of $77.95 per barrel, and was down by $1.05 to $78.01 per barrel by 03:57 GMT. The rate had managed to settle at $79.06 the previous day, which was the highest settlement since January 14.

"What is undermining oil prices at the moment is the sharp jump in the dollar following the Fed's announcement. But this is not just about the influence the dollar has on commodities, as there is also the concern of unwinding of stimulus measures, and that could dampen the economic recovery", said Toby Hassall, Analyst with CWA Global Markets in Sydney.

The stronger Dollar has managed to make oil and other commodities more expensive for holders of other currencies.