BLBG: Crude Oil Futures Trade Near 31-Month High, Heads for Eighth Monthly Gain
Oil traded near a 31-month high in New York, headed for an unprecedented eighth monthly gain as a weakening dollar offset signs of a faltering global economic recovery stoked speculation that demand for crude will decline.
Futures rose as much as 0.4 percent, reversing an earlier decline. The euro gained against the dollar after a report showed inflation in the euro zone accelerated to the fastest pace in 2 1/2 years, fanning speculation the European Central Bank may raise interest rates again.
“We are now in a rate-hike mood in Europe, while the U.S. is the other way around,” said Torbjoern Kjus, senior oil- market analyst at DnB NOR Markets in Oslo. “That’s the key reason for the rally in the euro against the dollar. It’s supportive to oil prices.”
Crude for June delivery rose as much as 48 cents to $113.34 a barrel in electronic trading on the New York Mercantile Exchange. It was at $113.30 at 1:04 p.m. London time. Yesterday, the contract climbed 10 cents to $112.86, the highest settlement since Sept. 22, 2008. Brent for June settlement was up 47 cents at $125.49 a barrel on London’s ICE Futures Europe exchange. The contract yesterday slid 11 cents to $125.02. Trading was thin today as the U.K. was closed for a public holiday to celebrate the wedding of Prince William and Kate Middleton.
The euro was up 0.3 percent at $1.4869. A weaker dollar makes commodities priced in the U.S. currency more appealing.
To contact the reporter on this story: Sherry Su in London at lsu23@bloomberg.net
To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net
