Oil Recovers on Weaker Dollar

Crude oil futures recovered on Thursday after six consistent bearish sessions mostly backed by weaker greenback. The US dollar fell in reaction to unchanged US jobless claims in higher US trade deficit which made commodities less expensive for investors holding foreign currencies. Crude oil prices were also affected in reaction to weaker Chinese trade data and the report of Organization of the Petroleum Exporting Countries which indicated that oil stockpiles are exceeding the global demand. According to the latest report of OPEC the global oil demand is expected to increase to 900,000 barrels per day in 2012 as compared to its earlier forecast of 860,000 barrels per day.

The US Labor Department also showed that jobless claims slightly decreased by only 1,000 to 367,000 in the last week which created more worries about US economic recovery. Those were the major reasons which kept oil under pressure despite weaker US dollar, as the dollar index DXY which tracks the greenback’s performance against its major rivals fell to 80.071 on Thursday as compared to 80.083 on Wednesday’s late trading hours.

Crude oil futures contract for June delivery gained 0.3 percent or $0.28 to settle at $97.08 per barrel on the New York Mercantile Exchange.

Among other energy commodities, gasoline futures contract for June delivery fell 0.5 percent or $0.01 to settle at $3.01 per gallon while heating oil for June delivery declined 0.5 percent or $0.02 to $2.98 per gallon.

Natural gas futures contract for June delivery gained 0.9 percent or $0.02 to settle at $2.49 per million British thermal units.


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