Crude ends little lower

Oil prices end more than 10% higher for the week

Crude prices ended little lower on Friday, 20 March, 2009. The rebounding dollar was mainly the reason for this. Crude, anyways, ended substantially higher for the week after the dollar slumped earlier during the week after Fed said that it will buy long term treasuries. Fed's recent moves had sparked some good notions about the recovery from the recent recession in US.

On Friday, crude-oil futures for light sweet crude for April delivery closed at $51.05/barrel (lower by $0.55 or 1.1%) on the New York Mercantile Exchange. The April contract expired on Friday. The more active May contract rose slightly to settle at $52.07/barrel. For the week, crude ended higher by 10.4%. For the month of February, crude prices had ended higher by 1.5%.

Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 67% since then. Year to date, in 2009, crude prices are higher by 18.5%. On a yearly basis, crude prices are lower by 51%.

Last week, the Fed said it was committed to buying $300 billion in longer-term Treasurys to help the struggling American economy recover. In the currency market on Friday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies, rose for the second time only in last nine sessions. In 2009, year to date, the dollar index has climbed 2.5%.

Last Wednesday, EIA reported that gasoline inventories rose by 3.2 million barrels in the week ended 13 March, 2009. The EIA also reported an increase of 2 million barrels in crude inventories. Market was expecting a decline in either case. The EIA also said distillate stockpiles, which include diesel and heating oil, rose by 100,000 barrels.

Earlier during the month, the IEA said in the monthly report that global oil supply in February is estimated at 83.9 million barrels a day, down 1 million barrels from a month ago and 3.4 million barrels from a year ago. The agency also lowered its forecast for this year's global oil demand to 84.4 million barrels a day, 1.5%, or 1.2 million barrels, lower than a year ago.

Also at the Nymex on Friday, April reformulated gasoline fell 1.4% to $1.457 a gallon and April heating oil dropped 2% to $1.3834 a gallon.

April natural-gas futures rose 1.3% to $4.227 per million British thermal units.