Related News
Oil settles below US$80 as dollar gains more on euro
Source: Agencies |
May 6, 2010, Thursday
|
Online Edition
Online Edition
OIL prices fell below US$80 a barrel yesterday as the dollar gained strength and a U.S. government report showed that crude supplies rose more than expected.
Benchmark crude lost US$2.77 to settle at US$79.97 a barrel on the New York Mercantile Exchange, the second day of sharp declines. The June contract fell by 4 percent on Tuesday.
The dollar gained again on the euro, which fell to a 14-month low against the dollar. Because oil is bought and sold in dollars, they often move in opposite directions. The value of the dollar dictates how much oil investors can afford.
But there are also signs that demand for energy is not as great as some had thought, which sank prices as well.
The Energy Information Administration said yesterday that crude inventories rose by 2.8 million barrels last week. Analysts expected an increase of only 1.5 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
And inventories of gasoline and distillates are rising as refineries step up production.
"The fact that refiners are processing as much crude as possible and still ending up with barrels going into storage is an especially bearish situation," said energy consultancy Cameron Hanover. "We have not seen anything like this since late 1985, just before prices collapsed."
While U.S. supplies remain high and demand weak, analysts said falling oil prices are more likely a result of speculative transactions and worry about European debt problems than a reaction to market fundamentals.
Meanwhile, gasoline futures prices dropped substantially Tuesday, down about 11.3 cents. That's the biggest drop since Sept. 1, when prices fell about 20.4 cents.
In Nymex trading yesterday gasoline lost 10.18 cents to settle at US$2.2204 per gallon, and heating oil gave up 7.50 cents to settle at US$2.1845 a gallon. Natural gas fell 2.2 cents to settle at US$3.991 per 1,000 cubic feet.
In London, Brent crude was down US$3.06 to settle at US$82.61 on the ICE futures exchange.
Benchmark crude lost US$2.77 to settle at US$79.97 a barrel on the New York Mercantile Exchange, the second day of sharp declines. The June contract fell by 4 percent on Tuesday.
The dollar gained again on the euro, which fell to a 14-month low against the dollar. Because oil is bought and sold in dollars, they often move in opposite directions. The value of the dollar dictates how much oil investors can afford.
But there are also signs that demand for energy is not as great as some had thought, which sank prices as well.
The Energy Information Administration said yesterday that crude inventories rose by 2.8 million barrels last week. Analysts expected an increase of only 1.5 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
And inventories of gasoline and distillates are rising as refineries step up production.
"The fact that refiners are processing as much crude as possible and still ending up with barrels going into storage is an especially bearish situation," said energy consultancy Cameron Hanover. "We have not seen anything like this since late 1985, just before prices collapsed."
While U.S. supplies remain high and demand weak, analysts said falling oil prices are more likely a result of speculative transactions and worry about European debt problems than a reaction to market fundamentals.
Meanwhile, gasoline futures prices dropped substantially Tuesday, down about 11.3 cents. That's the biggest drop since Sept. 1, when prices fell about 20.4 cents.
In Nymex trading yesterday gasoline lost 10.18 cents to settle at US$2.2204 per gallon, and heating oil gave up 7.50 cents to settle at US$2.1845 a gallon. Natural gas fell 2.2 cents to settle at US$3.991 per 1,000 cubic feet.
In London, Brent crude was down US$3.06 to settle at US$82.61 on the ICE futures exchange.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
