Crude takes a big leap

Prices soar as overall sentiment improves following positive economic data and weak dollar

Crude prices ended substantially higher on Tuesday, 27 September, 2011 at Nymex. Prices shot up as US stocks rallied for the third straight day right out of gate following the improved sentiment that came amid reports that officials in Europe are planning to shore up the region's fiscal and financial problems. A weak dollar also pushed up crude prices.



Light and sweet crude for November delivery rose $4.21 (5.3%) to $84.45 a barrel on the New York Mercantile Exchange on Tuesday. Prices rose to a high of $84.77 during intra day trading. Last week, crude lost 9.2%. For the month of August, 2011, crude shed 7.1%.

US stocks extended gains for third straight day on Tuesday after German Chancellor Angela Merkel expressed support for Greece on optimism that European leaders will reach an agreement to contain the region's debt crisis.

In the currency market on Tuesday, the dollar index, which measures the strength of the dollar against a basket of six other currencies, was trading lower by 0.5%.

Among economic data expected for the day, the Conference Board said its survey of consumer confidence last month showed a slight improvement, rising to a reading of 45.4 from 45.2 in August, but missing economists' forecasts for a rebound to 46.1.

Among other energy products on Tuesday, October gasoline rose 13 cents, or 4.9%, to $2.70 a gallon. Heating oil for the same month rose 9 cents, or 3.1%, to $2.88 a gallon.

October natural gas added 4 cents, or 1.2%, to $3.83 per million British thermal units.

At the MCX, crude oil for October delivery closed higher by Rs110 (2.7%) at Rs 4,114/barrel. Natural gas for October delivery closed at Rs 189.5, lower by Rs 2.8 (1.4%).