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SINGAPORE: Soaring oil prices continued higher in Asia on Friday,
trading above $115 on the back of a weakening US dollar that has
helped drive a series of record highs, analysts said.
New York’s main oil futures contract, light
sweet crude for delivery in May, was 17 cents higher at $115.03 a
barrel.
The contract reached $114.86 at the close of
floor trading on Thursday at the New York Mercantile Exchange, and
struck a record peak of 115.54 in electronic trade.
Brent North Sea crude for June delivery rose 20
cents to $112.63, from a close of $112.43 Thursday in London. The
contract earlier touched a high of $113.38.
“Oil is holding steady around the $115 level
and overall, the market in the near term will likely on average
trade sideways with a possibility of higher highs,” said Victor
Shum of Purvin and Gertz energy consultancy in Singapore.
As long as there are expectations that the US
dollar will fall, the relationship between the greenback and oil
will remain the focus guiding pricing, said Shum.
John Kilduff, an analyst at MF Global, agreed
the dollar remains a key factor.
“A weaker-trending dollar continues to be a
key impetus behind the rally in crude oil, and the greenback shows
no definitive signs of bottoming yet,” he said.
The dollar has fallen steeply against other
world currencies in recent months, as US economic growth has slowed
and fears have mounted that the world’s largest economy could be
in a recession.
The single European currency traded Friday at
$1.5901 after shooting on Thursday to a record $1.5984 following a
weak set of US data and hawkish comments on inflation by a European
Central Bank official.
Dealers say oil and other commodities have
benefited from an inflow of money from investors seeking higher
returns than they can get in battered financial markets.
The sliding US currency makes dollar-priced
goods, such as crude oil, relatively cheaper for buyers using other
currencies, stimulating demand.
US crude inventories slumped 2.3 million barrels
in the week ending April 11, far steeper than the consensus
forecast.
Crude reserves in the United States now stand at
313.7 million barrels, in the lower half of the average range for
this time of year, according to the US Department of Energy.
-- AFP
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