Oil prices near a new high for the year | Shanghai Daily

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Oil prices near a new high for the year

OIL prices neared new highs for the year yesterday as the dollar slipped against other major currencies, demonstrating how much the weakened U.S. currency can affect consumers globally.

The U.S. dollar index, where the U.S. currency is measured against other major currencies, hit a 14-month low yesterday. Because crude is bought and sold in dollars, it essentially becomes cheaper for international investors who have flooded into energy markets despite a big surplus of oil.

Energy experts expect the government will report Thursday that crude supplies are still growing. That does not appear to be a deterrent for many investors because the dollar is so weak.

Benchmark crude for November delivery gained 88 cents to settle at US$74.15 on the New York Mercantile Exchange. At one point, prices reached US$74.47, just short of the US$75 reached on Aug. 25, when the driving season was still in full swing.

Prices have now risen for four straight days and a barrel costs 4 percent more than it did one week ago.

Natural gas, which is not sold only in dollars, tumbled 29.2 cents, nearly 6 percent, to US$4.588 per 1,000 cubic feet on Nymex.

OPEC said yesterday China and other developing countries would push global oil demand up slightly next year, but added that any recovery would be "slow and weak."

The Organization of Petroleum Exporting Countries supplies over 35 percent of the world's crude.

Iraq's oil minister said yesterday that three international oil producers have accepted the country's terms to develop two fields and submitted revised offers, a major breakthrough for Iraq's oil industry.

The country's first postwar bidding round flopped June 30 after most oil companies rejected terms from the Iraqi government. Only one contract was awarded out of the eight oil and gas fields offered.

In other Nymex trading, heating oil rose almost 3 cents to settle at US$1.9234 a gallon, and gasoline for November delivery gained about 3.3 cents to settle at US$1.8318 a gallon.

In London, Brent crude rose US$1.04 to settle at US$72.40 on the ICE Futures exchange.



 

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