Business | Oil & Gas
Crude oil could fall this week on dollar gains
Crude oil may fall this week after the dollar rebounded against the euro, US inventories rose and a strike by oil workers in Nigeria ended.
- Bloomberg
- Published: 00:11 May 4, 2008
New York: Crude oil may fall this week after the dollar rebounded against the euro, US inventories rose and a strike by oil workers in Nigeria ended.
As many as 14 of 23 analysts surveyed by Bloom-berg News, or 61 per cent, said prices will drop through May 9. Five of the respondents, or 22 per cent, said oil will rise and four forecast little change. A week ago, 53 per cent said futures would fall.
The dollar rose to the highest level in five weeks against the euro on speculation the Federal Reserve will stop reducing borrowing costs.
The decline of the dollar over the past year prompted investors to purchase commodities as an inflation hedge. US crude oil inventories climbed in 13 of the past 16 weeks, an Energy Department report showed on April 30.
"The market has really been trying to explore the limits of how high it can go and it may have gotten the answer," said Tim Evans, an energy analyst at Citigroup Global Markets in New York.
The June crude oil contract declined $2.20, or 1.9 per cent, to $116.32 a barrel last week on the New York Mercantile Exchange.
Futures reached $119.93 a barrel on April 28, the highest since trading began in 1983.
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