Crude at six-month highs

Prices rise as dollar plunges

Crude prices jumped to six-month highs on Tuesday, 02 November 2010 at Nymex. Weakness in the dollar propped up crude prices. Positive global data also pushed up prices.



On Tuesday, crude oil futures for light sweet crude for December delivery closed at $83.9/barrel (higher by $0.95 or 1.2%). This was the highest settle for crude in almost six months. Last week, crude ended lower by 0.3%, its fourth consecutive weekly losses.

For the month of October, crude ended higher by 1.8%. In September, crude prices ended higher by 11.2%. For the third quarter, crude ended higher by 5.7%. Crude had ended second quarter of CY 2010 lower by 9.3%. For the first quarter of this year, crude rose by 5.5%. Year to date, crude is higher by 11.9%.

Earlier this week, surveys had showed rising manufacturing activity in China, brightening the picture for global growth and, by extension, for oil demand. China's official purchasing managers index rose to 54.7 in October from 53.8 in September.

In the currency market on Tuesday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies fell by 0.8%. Speculation that any future measures of quantitative easing might be applied gradually or be smaller in scope have kept the dollar volatile in recent times.

Among other energy products on Tuesday, reformulated gasoline advanced 2 cents, or 0.8%, to $2.11 a gallon.

Also on Tuesday, natural-gas futures recouped some of their recent losses, with the December contract rising 4 cents to $3.87 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. Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

At the MCX, crude oil for November closed higher by Rs 8 (0.2%) at Rs 3,737/barrel. Natural gas for November delivery closed at Rs 172.4, lower by Rs 0.6 (0.34%).