Crude rockets past $108

Price cross above $108 for the first time as dollar remains under pressure

Crude prices shot up once again today, Monday, 10 March, 2008. Prices rose after the dollar remained under pressure against its rival currencies. Since last week, prices have been consistently trading above $100 after the dollar dropped to three-year lows against the yen as a sell-off on Wall Street sapped investor appetite for risk. Energy prices have surged over the past year as the dollar plunged, prompting investors to seek a hedge against inflation.

Crude-oil futures for light sweet crude for April delivery today closed at $107.9/barrel (higher by $2.75/barrel or 2.6%) on the New York Mercantile Exchange. They earlier surged to $108.21 a barrel, the highest since trading began in 1983. Last week, crude prices ended higher by $3.31 (3.3%).

In the currency market today, the dollar remained under pressure, giving up earlier ground against most rivals, particularly the yen, as U.S. stocks withered. The dollar index, which measures the greenback against a basket of six major currencies, was at 72.920, down about 0.1%.

Brent crude oil for April settlement today rose $1.78 (1.7%) to $104.16 on the London-based ICE Futures Europe exchange. The London benchmark rose 54% in FY 2007, the most since 1999 when prices more than doubled.

Natural gas closes higher erasing earlier losses

Natural gas in New York advanced, erasing an earlier decline, after crude oil rose to a record above $108 a barrel. Natural gas for April delivery rose 25.5 cents (2.6%) to settle at $10.024 per million British thermal units.

Against this backdrop, April reformulated gasoline rose 2.06 cent to $2.7149 a gallon. April heating oil surged 2.64 cent to $2.9734 a gallon.

Crude had ended FY 2007 substantially higher by $35 or 57%. It was crude’s biggest yearly gain in five years.

At the MCX, crude oil for March delivery closed at Rs 4,346/barrel, higher by Rs 84(1.9%) against previous day’s close. Natural gas for March delivery closed at Rs 403.3/mmtbu, higher by Rs 5.6/mmtbu (1.4%).