Oil breached 98 US dollars
Oil breached 98 US dollars a barrel in Asian trade Wednesday for the first time ever, as traders anticipate another decline in US energy reserves, dealers said.
At 12:15 pm (0415 GMT), New York’s main contract, light sweet crude for December delivery traded at 97.87 dollars a barrel, up 1.17 dollars from its all-time closing record of 96.70 dollars in US trades Tuesday.
The contract had earlier traded at a new high of 98.03 dollars before falling to below 98 dollars.
Brent North Sea crude for December delivery crossed 94 dollars for the first time, rising 1.12 dollars to a new trading high of 94.38 dollars.
The dollar’s continued weakness against the euro and other major currencies was also another driver behind the run-up in crude oil prices to new peaks, dealers said.
“The dollar is falling very sharply this morning in Asia and commodities usually advance,” said Dariusz Kowalczyk, chief investment strategist at CFC Seymour in Hong Kong.
“These currencies can buy more oil for the same amount when the dollar declines,” he said.
A weak US unit encourages demand for dollar-priced commodities because it makes them cheaper for buyers using stronger currencies.