SIOUX FALLS, S.D. — Oil prices briefly passed $69 per barrel Tuesday in a weeklong rally that appears short on fundamentals, yet exceedingly full of momentum.
Average retail gasoline prices continued to march upward: A gallon now costs about 46cents more than it did a month ago.
After peaking at $69.05 Tuesday afternoon, a price not seen since early November, benchmark crude for July delivery fell 3 cents to settle at $68.55 a barrel on the New York Mercantile Exchange.
Investors buy commodities such as oil and gold as a protection against inflation and dollar weakness.
Oil prices have risen every day since May 21 on snips of moderately good news from manufacturers, home builders and the U.S. government.
"What kind of news? Well any kind of news, because we seem to be living in a world where good economic news for oil is bullish and bad economic news might be bullish too,” said Phil Flynn, an analyst at Alaron Trading Corp.
For instance, even though unused crude in storage remains near 19-year highs, which would typically drive prices down, levels have fallen for the past three weeks, Energy Department officials said. That is typical for this time of year, however.
There are some signs that major oil exporting countries, squeezed for months by low energy prices, have been bumping up production.
Analysts expect another drawdown of 2 million barrels when the Energy Information Administration reports crude levels today, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
Prices at the pump added slightly more than a penny overnight to hit $2.525, according to auto club AAA, Wright Express and Oil Price Information Service. That’s a dime higher than last week and well above the $2.07 that gasoline cost just a month ago. Still, a gallon of gasoline last year at this point was three cents shy of $4 per gallon.
by the associated press
Average retail gasoline prices continued to march upward: A gallon now costs about 46cents more than it did a month ago.
After peaking at $69.05 Tuesday afternoon, a price not seen since early November, benchmark crude for July delivery fell 3 cents to settle at $68.55 a barrel on the New York Mercantile Exchange.
Investors buy commodities such as oil and gold as a protection against inflation and dollar weakness.
Oil prices have risen every day since May 21 on snips of moderately good news from manufacturers, home builders and the U.S. government.
"What kind of news? Well any kind of news, because we seem to be living in a world where good economic news for oil is bullish and bad economic news might be bullish too,” said Phil Flynn, an analyst at Alaron Trading Corp.
For instance, even though unused crude in storage remains near 19-year highs, which would typically drive prices down, levels have fallen for the past three weeks, Energy Department officials said. That is typical for this time of year, however.
There are some signs that major oil exporting countries, squeezed for months by low energy prices, have been bumping up production.
Analysts expect another drawdown of 2 million barrels when the Energy Information Administration reports crude levels today, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
Prices at the pump added slightly more than a penny overnight to hit $2.525, according to auto club AAA, Wright Express and Oil Price Information Service. That’s a dime higher than last week and well above the $2.07 that gasoline cost just a month ago. Still, a gallon of gasoline last year at this point was three cents shy of $4 per gallon.
by the associated press
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