Oil Rises to 5-Week High

Crude oil rose to a five-week high as the U.S. dollar weakened against the euro, bolstering the appeal of commodities as an alternative investment.
TradingEconomics.com, Bloomberg 3/6/2009 12:28:37 PM

Oil climbed as much as 5.2 percent and the dollar fell the most in a week against the euro after unemployment advanced to the highest in 25 years in the U.S., the world’s biggest energy user. The Organization of Petroleum Exporting Countries will consider a fourth production cut when ministers meet on March 15.

Crude oil for April delivery rose $1.97, or 4.5 percent, to $45.58 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures touched $45.88 a barrel, the highest since Jan. 27. Prices are up 1.8 percent this week and 2.2 percent so far this year.

Crude oil in New York traded at a premium to London’s Brent grade today for the first time since Dec. 11 as stockpiles declined in Cushing, Oklahoma, where West Texas Intermediate oil, the U.S. benchmark, is delivered. WTI traded at an average premium of $1.25 a barrel since Jan. 1, 2000.

Inventories at Cushing have dropped 2.8 percent to 34 million barrels in the past three weeks, according to an Energy Department report on March 4. Supplies in the week ended Feb. 6 were the highest since at least April 2004, when the department began keeping records.

Brent crude oil for April settlement rose $1.28, or 2.9 percent, to $44.92 a barrel on London’s ICE Futures Europe exchange.

OPEC will reduce crude-oil shipments by 1.9 percent in the month ending March 21, according to Oil Movements. Members will load 22.67 million barrels a day in the period, down from 23.1 million a day in the month ended Feb. 21, the Halifax, England- based based tanker tracker said in a report yesterday.