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Oil gains on weaker dollar

Oil&Gas Materials 1 July 2011 02:58
U.S. crude oil price gained on Thursday as the dollar weakened against a basket of currencies, Xinhua reported.
Oil gains on weaker dollar

U.S. crude oil price gained on Thursday as the dollar weakened against a basket of currencies, Xinhua reported.

The Greece parliament voted for detailed austerity and privatization bills on Thursday and avoided the immediate debt default. The euro rallied against the dollar for the second straight day. The dollar index dipped about 0.5 percent, lifting oil prices.

But there were still concerns about the long-term risk for a possible default. And the U.S. job data came in discouraging. The Labor Department said initial jobless claims fell only 1000 last week, too little to sweep investors' pessimism about a sluggish economic recovery. It was also the consecutive 12th week that the jobless claims remained above 400,000.

Investors were also worrying about the liquidity in crude markets after the Federal Reserve's second round of quantitative easing monetary policy came to end on Thursday.

Light, sweet crude for August delivery rose 65 cents, or 0.69 percent to settle at 95.42 dollars a barrel on the New York Mercantile Exchange. Now the crude has bounced back to the level before the International Energy Agency declared a 60-million strategic reserve release plan last Thursday. But in the second quarter, it still registered a sharp fall of 10.6 percent, the biggest quarterly decline since late 2008.

In London, Brent crude for August delivery slipped and last traded around 112 dollars a barrel. Brent was set to post a quarterly loss of about 5 percent, the biggest one in a year.

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