NYMEX crude oil gains a third day on US-Russia tensions, dollar weakness

NYMEX crude oil prices rose on speculation that Russian crude may be disrupted because of rising tensions with the US, and the weaker dollar bolstered commodities. US plans for a missile shield in Poland will "spur an arms race" in Europe, Russia's Foreign Ministry said. About 1.1 million barrels of Caspian Sea crude remains shuttered following a pipeline fire in Turkey on Aug 5. Crude oil for October 2008 delivery rose $2.69 to $118.25 a barrel, recovering from a steep correction that took it down from $147.27 to $111. The September contract expired yesterday at $114.98. The US dollar slipped to a one-week low of $1.4832 against the euro. Gold gained to $817.61 an ounce.

- As I am writing this, NYMEX crude oil prices are up $8 to $119 from the recent low of $111, and gold is up $56 to $830 from the recent low of $774. Unless this is one heck of a bull trap, it looks like the summer lows could be behind us, proving my Beijing Olympics shutdown hypothesis. There will surely be lots of volatility on the way, volatility being a hallmark of commodity markets. We are back on track to $200 oil, and the next immediate resistance levels are in $10 intervals from $120, $130, $140 and the big one : $150. Support levels are $110, $100 and $90, but we wouldn't count on those now, would we?

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