Crude kisses $81 mark

Prices rise despite rise in crude inventories

Crude prices ended higher on Wednesday, 03 March, 2010. Prices rose as the dollar slipped against the euro increasing commodities' appeal against an alternate investment. The price rise was partly offset by the latest weekly inventory report that showed rising crude stockpiles for last week.

On Wednesday, crude-oil futures for light sweet crude for April delivery closed at $80.72/barrel (higher by $1.04 or 1.3%). During intra day trading, crude rose to a high of $81.31.

Crude prices rose 9.3% in February as supply-and-demand issues began to take hold in a market for months dominated by moves in the dollar. Last week, crude ended off 0.5%. Prices have ranged between $69 and $84 a barrel since October.

The EIA reported today that crude-oil stockpiles rose 4.1 million barrels last week, topping the 1.1 million barrels expected by market.

The report also showed that gasoline stockpiles rose 700,000 barrels while distillate inventories fell 900,000 barrels. Refineries operated at 81.9% of capacity.

In the currency market on Wednesday, the dollar weakened against the euro after Greece disclosed its pathway to reduce the budgetary deficit. The dollar index dropped by almost 0.6% during the day.

Among other energy products, gasoline futures gained 4 cents, or 2%, to $2.24 a gallon, while heating oil futures added 3 cents, or 1.6%, to $2.088 a gallon.

Also on Wednesday, natural gas for April delivery added 3 cents, or 0.7%, to $4.74 per million British thermal units.

Crude ended FY 2009 higher by 78%, the highest yearly gain since 1999. It reached a high of $82 earlier in October 2009 and hit a low of $33.98 on 12 February 2009. Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 45% since then. Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for February delivery closed Rs 15 (0.4%) lower at Rs 3,687/barrel. Natural gas for March delivery closed at Rs 219/mmbtu, higher by Rs 2 (0.92%).