Oil climbs to near $72

Oil prices rose to almost $72 (U.S.) a barrel Thursday, helped by a weaker U.S. dollar, steady OPEC production levels and a new report predicting a less severe slump this year in global oil demand.

By midday in Europe, benchmark crude for October delivery was up 50 cents to $71.81 a barrel in electronic trading on the New York Mercantile Exchange. Earlier in the day, the contract peaked at $72.44. On Wednesday, the contract rose 21 cents to settle at $71.31.

Crude has jumped from $68 a barrel in two days as the dollar weakened to its lowest level this year. Because crude is priced in the U.S. currency, it becomes cheaper when the dollar falls. Some investors also use commodities like oil and gold as a hedge against inflation and dollar weakness.

Globe and Mail

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza