Oil rises on weak dollar

29/04/2009

Crude oil prices have risen during early trading on the New York Mercantile Exchange (Nymex) this morning, buoyed by a weak dollar performance that is spurring investment from Asian traders.

The gains also indicate that fears that the spread of swine flu will put a halt on economic recovery are beginning to recede.

For the past two days, Nymex crude oil has fallen sharply in electronic trading and stabilised later in the day once it opened for trading in the US.

Christopher Bellew, senior broker at Bache Commodities, told Bloomberg that traders are buying up stocks of crude and distillates such as heating oil to take advantage of the weak dollar.

However, he added that the low cost of borrowing is also encouraging buying activity.

By 05:33 Eastern Time, the June delivery Nymex crude contract was trading at $50.74 (£34.36), up 82 cents on yesterday's closing price.