MW: Oil climbs above $95 a barrel after Cyprus deal
By Myra P. Saefong and Sara Sjolin, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures rose above $95 a barrel Monday, poised for their highest close in more than a month, after Cyprus secured a last-minute bailout deal to avoid a financial meltdown, easing concerns about energy demand from the euro zone.
Light, sweet crude-oil futures for May delivery CLK3 +1.19% rallied $1.67, or 1.8%, to $95.38 a barrel on the New York Mercantile Exchange after tapping a high at $96.65.
Prices haven’t closed above $95 since Feb. 20. The rise comes on top of a $1.26 advance on Friday.
“Oil prices are back on the rebound on the back of renewed economic confidence in the euro zone over the Cyprus bailout deal,” said analysts for the Kilduff Report.
An agreement Monday paved the way for Cyprus to receive up to 10 billion euros ($13 billion) in bailout funds from the troika — the European Commission, the European Central Bank and the International Monetary Fund — to avert a potential collapse of the European nation’s financial system.
The Cyprus news also helped lift the euro briefly back above $1.30. The ICE dollar index DXY +0.55% , which measures the greenback’s moves against a basket of six major global currencies, traded as low at 82.146 from 82.387 in North America on Friday, but was up at 82.647 at last check. A weakened dollar helps lift prices of commodities, including crude-oil, by making it cheaper to holders of other currencies to buy.
Now that the Cyprus deal is out of the way, “it’s back to the [economic] data, which continues to be good,” the Kilduff Report analysts said. The solid economic data out of the U.S. is helping to support West Texas Intermediate crude at the expense of Brent crude, they said.
Data released last week included a climb in the U.S. flash manufacturing purchasing managers’ index for March.
Brent, Europe’s benchmark crude, hasn’t been gaining quite as much as WTI. On Monday, the London-traded May Brent futures contract UK:LCOK3 +0.21% climbed $1.05, or 1%, to $108.71 a barrel on ICE Futures. On Friday, it rose a modest 0.2%.
Among other products in the energy complex, the April contract for gasoline RBJ3 +0.14% gained 4 cents, or 1.2%, $3.10 a gallon and heating-oil futures HOJ3 -0.23% for delivery in the same month edged up 4 cents, or 1.3%, to $2.92 a gallon.
April futures for natural gas NGJ13 +1.22% climbed 6 cents, or 1.4%, to $3.98 per million British thermal units.
Myra Saefong is a MarketWatch reporter based in San Francisco. Follow her on Twitter @MktwSaefong.
Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin. V. Phani Kumar in Hong Kong contributed to this report.
