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Oil rebounds from $80

21 October 2009 08:20 (UTC +04:00)

Bakuâ€“ APA-Economics. Crude oil fell from a one-year high as the dollar pared losses against the euro and OPEC Secretary- General Abdalla El-Badri said prices above $80 will hamper economic growth, Bloomberg reported.

Oil traded at more than $80 a barrel as the dollar index, which measures the U.S. currency against six major currencies, fell to its lowest since August 2008, boosting the appeal of commodities as a currency hedge.
Crude oil for November delivery fell as much as 55 cents, or 0.7 percent, to $79.06 a barrel in electronic trading on the New York Mercantile Exchange. It traded at $79.42 a barrel at 1:33 p.m. London time.
Earlier, prices rose as much as 44 cents, or 0.6 percent, to $80.05 a barrel, the first time the front-month contract has traded above $80 since Oct. 14, 2008.
The November contract expires today. The more-active December future was at $79.84 a barrel, down 11 cents.
The U.S. currency traded as low as $1.4994 per euro, the weakest since August 2008. It then recovered to $1.4975.
Prices have gained 78 percent this year, accelerating its climb as a recovery in stock markets emboldened investors and the weakening dollar prompted buying of commodities.
El-Badri said he doesnâ€™t expect prices to reach $100 in the near future because thereâ€™s â€œno shortage of oil supply.â€
The rally to more than $80 a barrel was driven by higher equities, the sliding dollar and speculation, he told reporters in London today. The 125 million barrels of crude oil and oil products currently in floating storage is a concern for the Organization of Petroleum Exporting Countries, he said.
The Energy Department is scheduled to release its weekly report tomorrow at 10:30 a.m. in Washington. The industry-funded American Petroleum Institute will put out its data today.
Brent crude oil for December settlement fell 5 cents, or 0.1 percent, to $77.72 a barrel on the London-based ICE Futures Europe exchange as of 1:33 p.m. local time.