Crude rises for fourth straight day

Prices rise as dollar continues to weaken

Crude prices ended higher once again on Wednesday, 09 September, 2009. Prices ended higher due to the weak dollar and also as traders anticipated that tomorrow' weekly inventory report will show another drop in crude and crude product inventories for last week.

On Wednesday, crude-oil futures for light sweet crude for October delivery closed at $71.31/barrel (higher by $0.21 or 0.3%). During intra day trading, crude touched a high of $72.52. Last week, crude ended lower by 6.5%. It was the biggest weekly loss for crude in two months.

For the month of August, 2009, crude ended higher by a marginal 0.7%. For the second quarter, crude ended higher by 40%. Crude prices had rallied 11.3% in the first quarter of 2009.

Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 51.4% since then. Year to date, in 2009, crude prices are higher by 52.3%.

In the currency market today, the U.S. dollar fell to a new yearly low. The dollar index, which measures the strength of dollar against a basket of other currencies, fell by 0.5% but ultimately settled lower by 0.3%.

Traders are anticipating that tomorrow's energy inventory report will show that crude supplies dropped 1.8 million barrels for the week ended 4 September, 2009. They also predict a drop of 1.5 million barrels in gasoline inventories and an increase of 1.1 million barrels in distillates, which include heating oil and diesel.

The Organization of Petroleum Exporting Countries, which accounts for about one-third of the world's oil production, started their meet in Vienna today.

Also at the Nymex on Wednesday, October reformulated gasoline ended slightly lower at $1.8281 a gallon and October heating oil rose 1.19 cents, or 0.7%, to $1.7944 a gallon.

October natural gas gained 2.2 cents, or 0.8%, to $2.829 per million British thermal units.

Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for September delivery closed higher by Rs 25 (0.72%) at Rs 3,485/barrel. Natural gas for September delivery closed higher by Rs 4.1 (3%) at Rs 140.4/mmbtu.