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Oil maintains momentum to rise to near US$82
Source: Agencies |
March 9, 2010, Tuesday
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OIL prices settled near US$82 a barrel yesterday, extending gains from last week amid signs the global economy may be improving.
Benchmark crude for April delivery rose 37 cents to settle at US$81.87 a barrel on the New York Mercantile Exchange. Earlier in the session, it peaked at US$82.41.
In London, Brent crude gained 58 cents to settle at US$80.47 on the ICE futures exchange
While there were no major economic reports yesterday, investors were cheered by the Labor Department's February jobs report Friday, which showed the U.S. economy shed a less-than-expected 36,000 jobs last month and the unemployment rate held at 9.7 percent.
Crude investors also took heart from news that China plans to extend a stimulus package in hopes of helping the economy grow 8 percent this year.
Oil has soared 18 percent since Feb. 5 as investors become more convinced a growing global economy will boost crude demand.
Some analysts, however, said that the current rise in prices was driven by technical factors such as investors' positions in the market, not a real rise in oil consumption.
"Commodity markets often go through periods of 'disconnect' between fundamentals and the underlying technicals, and the energy markets ... are going through one of those phases right now," said Edward Meir of MF Global in New York. "We very well could retest the 2010 highs of US$83.95. However, our belief is that should we get there, a rather substantial correction will set in, sending prices back into the mid-to high US$70 range."
The dollar's exchange rate is often seen moving oil prices, with a weaker dollar making crude cheaper for investors holding other currencies and vice versa.
The euro rose to US$1.3633 yesterday in late New York trading, from US$1.3624 late Friday.
In other Nymex trading in April contracts, heating oil rose 0.81 cent to settle at US$2.1055 a gallon. Natural gas fell 6.6 cents to settle at US$4.527 per 1,000 cubic feet. During the trading day, natural gas touched a new 52-week low at US$4.458 per 1,000 cubic feet.
April wholesale gasoline contracts rose 1.82 cents to settle at US$2.2892 per gallon.
Benchmark crude for April delivery rose 37 cents to settle at US$81.87 a barrel on the New York Mercantile Exchange. Earlier in the session, it peaked at US$82.41.
In London, Brent crude gained 58 cents to settle at US$80.47 on the ICE futures exchange
While there were no major economic reports yesterday, investors were cheered by the Labor Department's February jobs report Friday, which showed the U.S. economy shed a less-than-expected 36,000 jobs last month and the unemployment rate held at 9.7 percent.
Crude investors also took heart from news that China plans to extend a stimulus package in hopes of helping the economy grow 8 percent this year.
Oil has soared 18 percent since Feb. 5 as investors become more convinced a growing global economy will boost crude demand.
Some analysts, however, said that the current rise in prices was driven by technical factors such as investors' positions in the market, not a real rise in oil consumption.
"Commodity markets often go through periods of 'disconnect' between fundamentals and the underlying technicals, and the energy markets ... are going through one of those phases right now," said Edward Meir of MF Global in New York. "We very well could retest the 2010 highs of US$83.95. However, our belief is that should we get there, a rather substantial correction will set in, sending prices back into the mid-to high US$70 range."
The dollar's exchange rate is often seen moving oil prices, with a weaker dollar making crude cheaper for investors holding other currencies and vice versa.
The euro rose to US$1.3633 yesterday in late New York trading, from US$1.3624 late Friday.
In other Nymex trading in April contracts, heating oil rose 0.81 cent to settle at US$2.1055 a gallon. Natural gas fell 6.6 cents to settle at US$4.527 per 1,000 cubic feet. During the trading day, natural gas touched a new 52-week low at US$4.458 per 1,000 cubic feet.
April wholesale gasoline contracts rose 1.82 cents to settle at US$2.2892 per gallon.
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