Monday June 09, 2008

Crude oil price rises by unprecedented $11.33 to reach new $139.12 record on NYMEX

This article belongs to the NYMEX crude oil price records story arc.

bloomberg.com :

Crude oil surged more than $10 a barrel to a record as the dollar weakened after the U.S. unemployment rate grew the most in two decades and Morgan Stanley said prices may reach $150 within a month. The dollar weakened against the euro after unemployment rose to 5.5%, signaling the Federal Reserve may be reluctant to increase interest rates. Crude oil for July delivery rose $10.75 or 8.4% to settle at $138.54 a barrel on the New York Mercantile Exchange [NYMEX]. Today's [6 Jun 2008] increase was the biggest gain in dollar terms ever and the largest on a percentage basis since June 1996. Oil rose $11.33 to an all-time high $139.12 a barrel during trading. Today's rise was bigger than the entire price of oil on Dec. 10, 1998, when crude traded at $10.72 a barrel. Oil has more than doubled in the past year.

latimes.com :

The biggest one-day surge ever in crude prices was fueled by a mix of factors, including a gloomy U.S. job report and interest-rate fears that drove down the dollar, unease in the oil-rich Middle East and a prediction by a major brokerage firm that crude could hit $150 a barrel by July 4. "Never before seen, unprecedented, amazing, epic, all those fit to describe today's [trading] session for crude oil and refined products," Denton Cinquegrana of the Oil Price Information Service wrote in a report to clients late Friday.

- Yes, it must have been an epic session indeed. Funny things seem to happen in the markets when I go away on holiday. The last time I took a couple of days' break was back in August 2007 and you all know what happened then - the stock markets crashed big time and the credit crisis began in earnest. As I remarked over on peakoil.com, perhaps I should go on vacation more often.

Let's take a look at the media's excuses this time. This past Friday, the culprits were supposedly a "mix of factors", and these included the dollar, Middle East unrest, and check this out, a "prediction" by Morgan Stanley of $150 oil. Well, I could join in the fun too. I will just cut to the chase and come up with a prediction of $300 oil and $3,000 gold, and if these come to pass one day, I would then say that my predictions from way back had caused the markets to move by that much. Various blog aggregators and the Google cache will then verify that yes, I did write such a thing on such a date, and yes, I did cause these price moves to happen. All by myself. Very funny indeed.

All jokes aside, the resistance levels for crude oil remain at $150, $200, $300 and over $400- I did say all this before, and I'm just saying this here again. Support levels are at $130, $120, $110 and $100. It does look like we're pretty over-extended as it is on the upside, but hey, it's a bull market. Classic demand and supply. It really doesn't get any simpler than this.

See also :

1. Crude oil hits $135.04 record on unexpected drop in US inventories
2. Crude oil reaches record $129.60 on supply concern
3. Crude oil hits $126.98, extending record run to 7 days in a row

(2008-06-09 00:26:12 SGT) [Energy] Permalink

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