Sunday May 11, 2008

Crude oil caps record-breaking week by reaching $126.27 on NYMEX

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

bloomberg.com :

Crude oil rose above $126 a barrel in New York to a record as the dollar weakened against the euro, prompting investors to buy commodities as a hedge against the currency's decline. For a fifth day oil climbed to all-time highs as the euro strengthened on signs the European Central Bank [ECB] will keep rates at a six-year high to cut inflation. Nigerian output fell to the lowest this decade in April because of a strike and attacks on oil installations. Crude oil for June delivery surged to $126.27 today [9 May 2008], the highest since futures began trading in 1983. Futures have more than doubled in the past year.

Oil at $200 is "possible if we have a continuing devaluation of the dollar with respect to other currencies," OPEC President Chakib Khelil said yesterday [8 May 2008] at a press conference in Washington. Goldman Sachs analyst Arjun N. Murti wrote in a report on May 6 that "the possibility of $150-$200 per barrel seems increasingly likely over the next six-24 months." Murti first wrote of a "super spike" in March 2005, predicting crude may trade between $50 and $105 a barrel through 2009.

- It has been an incredible week in the oil markets. Another day, another record, and at times records were being broken 2 or 3 times a day. Now this is turning into some kind of regular occurrence, this record-breaking-days-in-a-row thing. We had 5 crude oil record-breaking days in a row in Apr 2008 when it hit $117, and before that we had 7 record-breaking days in a row in Mar 2008 when it hit $111.

The media continues to search for reasons to explain this relentless rise. We're back to the Euro reason again as the driver for rising oil prices. But has anyone noticed that with the EUR/USD forex rate at 1.5489 right now, oil's new record at $126.27 is even higher than the $119.90 reached when EUR/USD touched 1.6019 earlier? Ha! Explain that.

Like I said before, further resistance levels are around $150, $180 and $200, and just for fun, I'd like to point out now that the next 2 levels after that could be around $300 and then over $400. Ha! Take that. Ahem. Support levels are $120, $110, $100 and $90.

See also :

1. Crude oil continues 5-day record-breaking run to reach $125.98
2. Crude oil continues record-breaking streak, hits $123.93 on NYMEX
3. Crude oil hits $122.73 record on supply disruptions and global demand
4. Crude oil hits $120.36 record on Nigeria, economic data

(2008-05-11 14:43:12 SGT) [Energy] Permalink

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