Monday, June 14, 2010

Crude Oil Rises Above $75 After European Industrial Output Gains

Crude oil rose above $75 a barrel on speculation economic growth will accelerate after European industrial production climbed more than forecast in April. Oil increased as much as 3 percent after the European Union’s statistics office reported that output in the 16 nations using the euro advanced 0.8 percent. Economists projected a gain of 0.5 percent, according to a Bloomberg News survey. The dollar dropped to its lowest level against the common currency in more than a week, strengthening the appeal of commodities.

“The industrial numbers out of Europe were somewhat better than expected, which is bolstering confidence about the region’s economy,” said Phil Flynn, vice president of research at PFGBest in Chicago. “The strength of the euro is a major factor pushing most commodities higher today.” Crude oil for July delivery rose $1.25, or 1.7 percent, to $75.03 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures are up 4.2 percent from a year ago.

Brent crude oil for July delivery increased 68 cents, or 0.9 percent, to $75.03 a barrel on the London based ICE Futures Europe exchange. Oil retreated from the day’s high after Moody’s Investors Service said it downgraded Greece’s government bond ratings by four levels to Ba1 from A3. Oil and the euro tumbled in May on concern that Greece’s debt crisis would spread to other nations using the common currency.

The dollar declined against the euro for the fourth time in five days. The single currency gained as much as 1.5 percent to $1.2299, the highest since June 3. The Standard & Poor’s 500 Index increased 0.2 percent to 1,093.89.....Read the entire article.

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