Oil Prices Dip in Profit Taking

NEW YORK: Oil prices slipped Friday under pressure from a slightly stronger dollar and profit taking from recent gains.

New York’s main contract, light sweet crude for October, dipped 43 cents to close at 72.07 dollars a barrel.

In London, Brent North Sea crude for November delivery dropped 23 cents to settle at 71.32 dollars.

“Oil prices have surrendered some recent gains with the US dollar finding some footing,” said Mike Fitzpatrick of MF Global,

The New York futures contract remained above 72 dollars, at the higher end of the narrow trading range of the past three weeks.

The dollar’s small appreciation weighed on dollar-priced oil, making it more expensive for buyers using weaker currencies.

However, the dollar’s overall weakening trend — it has sunk to a near-year low against the euro — has been price-supportive of oil and other commodities.

Oil futures closed mainly flat Thursday despite positive US economic data as markets appeared to take a breather from recent gains driven by hopes of recovery from global recession.

“A raft of positive US economic data, from jobless claims to housing starts, continued to provide more evidence of a recovery at play, and should bode well for oil demand prospects in our view,” said Amrita Sen of Barclays Capital.

“In particular, diesel demand should be the main beneficiary from rising economic activity in the US, with an initial burst of goods restocking activity leading to a sharp improvement in diesel demand through the movement of more trucks and rail,” he said.

---

Oil Prices Dip in Profit Taking was first posted on September 20, 2009 at 1:21 pm.
©2009 “News Trends“.