Crude oil rose for the first time in five days as the dollar weakened and some investors took the view a decline below $75 made it an attractive investment. Oil snapped four days of losses as the dollar fell against the euro, increasing the appeal of commodities as an alternative investment. The contract has traded between $75 and $81 for almost eight weeks and yesterday settled below $75 for the first time since Oct. 13.
“Markets had for a while started to get used to the $75 to $80 a barrel range for oil, and the move to the lower part of that range is probably attracting some buying,” David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney, said by telephone. “The U.S. dollar eased back and that’s been another factor why the oil price has lifted.”
Crude oil for January delivery gained as much as 46 cents, or 0.6 percent, to $74.39 a barrel in electronic trading on the New York Mercantile Exchange. It was at $74.12 a barrel at 11:58 a.m. Singapore time. Yesterday, the contract fell $1.54, or 2 percent, to $73.93. Prices have climbed 67 percent this year.The dollar traded at $1.4841 per euro at 12:05 p.m. in Singapore, from $1.4827 yesterday.
Oil dropped yesterday as Federal Reserve Chairman Ben S. Bernanke said the U.S. economy will face a weak labor market and tight credit, signaling fuel demand will be slow to recover. Bernanke’s comments “gave markets a bit of a reality check and made people reassess how they thought the recovery is going to pan out,” Ben Westmore, an energy and minerals economist at National Australia Bank Ltd. in Melbourne, said by phone. “As a result oil got sold off”.....Read the entire article.
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