Oil prices just below $79 per barrel

27/10/2009

Oil prices traded at just below $79 per barrel this Tuesday (October 27th), following three days of losses as traders looked to the US dollar for clues.

Benchmark US crude oil for December delivery fell to $78.82 at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange, rising 14 cents, reports the Associated Press.

The newswire reports that the contract had settled at $78.68 on Monday, following a $1.82 decrease in price per barrel.

In a report Bank of America Merrill Lynch said: "The combination of surging money supply, a rapidly weakening dollar and a cyclical improvement in oil demand could push oil prices above $100."

Jorg Zeuner of Liechtenstein-based VP Bank said that he anticipates that oil and the dollar will stabilise over the coming months as fears of inflation ease and that high levels of stockpiles will cope with any increase in demand.

It was recently reported that the Organization of the Petroleum Exporting Countries believes that the increases seen recently with oil prices were due to the US dollar.