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Oil jumps to $71 on dollar slump

09 September 2009 08:21 (UTC +04:00)

Bakuâ€“ APA-Economics. Crude oil traded near $71 a barrel after surging yesterday as a slump in the dollar spurred demand for commodities and as China pledged to stockpile more supplies for emergency use, Bloomberg reported.
Oil gained as much as 5.5 percent yesterday as the U.S. currency dropped to the lowest level this year against the euro and on speculation inflation will accelerate. China, the worldâ€™s second-largest crude oil user, approved a plan to have 169 million barrels in the second phase of an emergency stockpile, state-owned China National Petroleum Co. said yesterday.
Crude oil for October delivery was at $71.43 a barrel, up 33 cents in electronic trading on the New York Mercantile Exchange at 1:40 p.m. in Singapore. Yesterday, the contract rose $3.08, or 4.5 percent, to $71.10, the biggest gain since Aug. 19. Prices are up 60 percent this year.
The dollar index, which measures the greenback against a basket of six major currencies, was little changed today after falling yesterday to 77.047, the lowest since Sept. 29. Investors buy commodities to hedge against inflation when the dollar climbs.
Brent crude oil for October settlement traded at $69.60 a barrel, up 18 cents on the London-based ICE Futures Europe exchange at 1:34 p.m. in Singapore. Yesterday, it rose $2.89, or 4.3 percent, to settle at $69.42, the first gain in seven days.