West Texas Intermediate and Brent oils climbed from five-year lows as the dollar fell and a technical indicator signaled the market is due for a rebound.
Futures climbed as the U.S. currency dropped from the strongest level in two years versus the euro. A weaker dollar bolsters the appeal of raw materials as a store of value. Prices have tumbled since the 12-nation Organization of Petroleum Exporting Countries decided Nov. 27 to maintain output levels, letting prices decrease to a level that may slow U.S. output that’s surged to the highest level in three decades.
“The commodities are popping today because of the break in the dollar’s rally,” Phil Flynn, senior market analyst at the Price Futures Group in Chicago, said by phone. “The dollar’s plunge is giving oil a boost in what’s an oversold market.”