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Oil passes $98 on weaker dollar | Oil passes $98 on weaker dollar |
(about 2 hours later) | |
The ever-weakening dollar and fresh worries about winter fuel supplies have sent US oil prices past $98 a barrel. | The ever-weakening dollar and fresh worries about winter fuel supplies have sent US oil prices past $98 a barrel. |
With global crude prices further lifted by bad weather hitting North Sea oil rigs US light crude touched $98.62 in early trade, before slipping to $98.16. | |
London Brent crude also increased, to a $95.19 high, before falling to $94.56. | |
The weaker dollar has been driving up oil prices because some investors have been using the commodity as an alternative to holding dollars. | The weaker dollar has been driving up oil prices because some investors have been using the commodity as an alternative to holding dollars. |
On the other hand, it makes oil relatively cheaper for anybody outside the US. | On the other hand, it makes oil relatively cheaper for anybody outside the US. |
Evacuations | Evacuations |
US light crude later pulled back to $98.25 by mid-morning trading in Europe, while Brent slid to $94.89. | US light crude later pulled back to $98.25 by mid-morning trading in Europe, while Brent slid to $94.89. |
How China and India respond to the rising threats to their energy security will also affect the rest of the world International Energy Agency | How China and India respond to the rising threats to their energy security will also affect the rest of the world International Energy Agency |
However, the prices were still up on Tuesday's closes. | However, the prices were still up on Tuesday's closes. |
After oil prices have now risen 60% this year, analysts say that $100-a-barrel oil is inevitable. | After oil prices have now risen 60% this year, analysts say that $100-a-barrel oil is inevitable. |
"We're going to get $100 before too long," said Kevin Norrish of Barclays Capital. | "We're going to get $100 before too long," said Kevin Norrish of Barclays Capital. |
"I think we'll get there," said Dariusz Kowalczyk at CFC Seymour. "The factors that have been driving the recent trend are still in place." | "I think we'll get there," said Dariusz Kowalczyk at CFC Seymour. "The factors that have been driving the recent trend are still in place." |
Adjusting for inflation, US light crude's record peak of $101.70 came in 1980 against a backdrop of war between Iraq and Iran. | Adjusting for inflation, US light crude's record peak of $101.70 came in 1980 against a backdrop of war between Iraq and Iran. |
Predicted storms in the North Sea have seen a number of producers evacuate their facilities, such as BP and ConocoPhillips. | Predicted storms in the North Sea have seen a number of producers evacuate their facilities, such as BP and ConocoPhillips. |
Gold prices | Gold prices |
The dollar's current weakness has also seen prices of other commodities rise sharply, most notably gold, which is continuing near 27-year highs. | The dollar's current weakness has also seen prices of other commodities rise sharply, most notably gold, which is continuing near 27-year highs. |
Gold prices have also been lifted by the higher cost of oil, as investors see it as a haven against the inflation risk caused by increased crude costs. | Gold prices have also been lifted by the higher cost of oil, as investors see it as a haven against the inflation risk caused by increased crude costs. |
Separately on Wednesday, the International Energy Agency (IEA) warned that the rapid economic growth in China and India could have devastating consequences for the world's energy supply. | Separately on Wednesday, the International Energy Agency (IEA) warned that the rapid economic growth in China and India could have devastating consequences for the world's energy supply. |
Calling on both countries to increase efforts to curb their demand for oil, petrol and natural gas, the IEA said the two countries would account for about 45% of the increase in global energy demand by 2030. | Calling on both countries to increase efforts to curb their demand for oil, petrol and natural gas, the IEA said the two countries would account for about 45% of the increase in global energy demand by 2030. |
"How China and India respond to the rising threats to their energy security will also affect the rest of the world," said the Paris-based agency. | "How China and India respond to the rising threats to their energy security will also affect the rest of the world," said the Paris-based agency. |