Oil Rises a Second Day

Crude oil rose in New York, the biggest two-day gain in three months, as investors purchased commodities as a safe haven in the midst of Wall Street turmoil.

Oil climbed and gold surged the most in eight years yesterday as Goldman Sachs Group Inc. and Morgan Stanley plunged the most ever. Prices were supported by a fifth day of militant attacks in Nigeria, Africa's largest crude producer, that have disrupted 280,000 barrels a day of production.

Crude for October delivery rose as much as 98 cents, or 1 percent, to $98.14 a barrel on the New York Mercantile Exchange. It was trading at $97.40 a barrel at 9:56 a.m. in Singapore. Oil has declined 34 percent from the record $147.27 a barrel reached on July 11.

Yesterday, oil rose $6.01, or 6.6 percent, to $97.16 a barrel. The two-day gain was the biggest since June 6. Oil futures tumbled more than $10 a barrel in the first two days of the week on concern financial-market disruptions may weaken the global economy and cut fuel consumption.

Gold climbed for a second day, extending its biggest jump in 26 years, as investors sought a haven from the credit crisis that's sent equity markets tumbling. Silver also rose.

Gold for immediate delivery rose 0.6 percent to $868.65 an ounce at 9:20 a.m. in Sydney. The metal jumped 11 percent yesterday, its biggest gain since Sept. 3, 1982. Silver rose 1.7 percent to $12.16 an ounce.

U.S. crude-oil stockpiles fell 6.33 million barrels to 291.7 million barrels last week, according to the Energy Department. It was the fourth straight inventory decline. A drop of 3.5 million barrels was forecast, according to the median of responses by 11 analysts surveyed by Bloomberg News.

Prices also advanced after a U.S. government report yesterday showed that crude oil stockpiles dropped the most since May because of disruptions from Hurricane Ike.

TradingEconomics.com, Bloomberg.com
9/18/2008 5:27:46 AM