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Oil steadies near record as dollar rises from new low
Oil steadied on Thursday after setting a record high above $115 a barrel earlier in the session as a drop in US gasoline and crude inventories raised concern of tighter supply.
- Reuters
- Published: 00:28 April 18, 2008
London: Oil steadied on Thursday after setting a record high above $115 a barrel earlier in the session as a drop in US gasoline and crude inventories raised concern of tighter supply.
A US government report on Wednesday showed a surprise drop in crude inventories and a larger-than-expected decline in stocks of gasoline. Demand for the motor fuel usually peaks in the summer.
"The helpful thing for the market is the further erosion in product stocks," said Christopher Bellew, senior vice-president at Bache Commodities. "Technically, the market still looks bullish."
US crude set a record of $115.54 a barrel and by 1525 GMT was trading at $114.53, down 40 cents. Oil has hit new peaks for three straight days. London Brent set a record of $113.38.
Trade could be volatile due to the expiry of May US crude options yesterday, dealers said.
The euro retreated from a record high against the dollar in choppy trade yesterday after a top euro zone official called recent euro appreciation "undesirable".
The euro was last trading at $1.5915, down 0.2 per cent from Wednesday. That was above a session low around $1.5848 but off an overnight record high just short of $1.60.
The euro backed off its record in early New York trade after Eurogroup head Jean-Claude Juncker said excessive exchange rate volatility was bad for global growth and called euro gains against the dollar "undesirable".
The Eurogroup comprises the finance ministers of the 15-country euro zone.
"The market is chasing its tail today, trying to take out $1.60 overnight before Juncker's comments took everyone by surprise and wiped out some euro longs," said Steven Butler, head of FX trading at Scotia Capital in Toronto.
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