Monday, November 8, 2010

Crude Oil Declines From Two Year High After Dollar Advances Against Euro

Crude oil retreated from its highest level in two years as the dollar strengthened against the euro, curbing crude’s appeal as an alternative investment. Oil fluctuated as the dollar advanced for a second day against the European single currency. Hedge funds increased bullish bets on oil to the highest level since at least June 2006, data from the U.S. Commodity Futures Trading Commission showed last week. “The dollar is stronger so the oil market may be taking its cue from that,” said Tom Bentz, a broker with BNP Paribas Commodity Futures Inc. in New York. “The CFTC data from Friday shows that there are still plenty of bulls out there. We could turn at any moment.”

Crude for December delivery was unchanged from Nov. 5 at $86.85 a barrel at 12:52 p.m. on the New York Mercantile Exchange. Oil has gained 12 percent in the past year. Prices jumped 6.7 percent last week, the most since February, as the Labor Department said U.S. payrolls climbed by 151,000 workers in October following a revised 41,000 drop the prior month. New York oil futures reached $87.49 a barrel earlier today, the highest price since Oct. 9, 2008, on an intraday basis. Brent crude for December settlement rose 20 cents, or 0.2 percent, to $88.31 a barrel on the ICE Futures Europe exchange in London.

The world will “have to live with current oil prices,” Qatari Oil Minister Abdullah al-Attiyah said today in Doha. The market isn’t oversupplied with oil, he added. The dollar gained 0.6 percent to $1.3943 per euro from $1.4032 on Nov. 5 in New York. The currency has advanced 1.9 percent since Nov. 4. It rose today amid concern that Ireland will struggle to plug its budget deficit......Read the entire article.


No comments: