Oil prices rise above 75 dollars

28th May 2010, Comments 0 comments

Oil prices climbed above 75 dollars on Friday, boosted by signs of higher demand for energy, traders said.

New York's main contract, light sweet crude for delivery in July, jumped 86 cents to 75.41 dollars a barrel.

Brent North Sea crude for July gained 73 cents to 75.39 dollars.

"Oil prices continue to rise as the focus on fundamentals returns, with OECD oil demand and in particular US oil demand improving markedly," said Barclays Capital analyst Amrita Sen.

Oil prices began rallying on Wednesday, with sentiment lifted by recovering stock markets and fresh data pointing to a sustained economic recovery in the key US energy market.

A report by the US Department of Energy showed an unexpected dip in US gasoline (petrol) supplies of 200,000 barrels. Distillate stocks, including diesel and heating oil, fell 300,000 barrels in the week ending May 21.

Andrey Kryuchenkov, a commodities analyst with Russian investment bank VTB Capital, said the market was "upbeat about healthy demand for fuel products in the US."

Oil built on Wednesday's gains by surging more than two dollars on Thursday as the euro rebounded against the dollar and global stock markets bounced higher, traders said.

A weaker US unit makes dollar-priced crude cheaper for buyers using stronger currencies, which therefore tends to stimulate oil demand and push prices higher.

Crude oil prices sunk more than one dollar on Tuesday on fears the eurozone financial crisis could turn toxic for the global economic recovery.

Fears that contagion from Greece's sovereign debt crisis could spread to other vulnerable eurozone members were heightened by the Spanish government's bailout of a regional savings bank, Cajasur, over the weekend.


© 2010 AFP

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