The move higher came despite a stronger dollar, which often dampens enthusiasm for commodities, and after news of yet another build in US crude oil inventories.
US crude for May delivery rose 70 cents to $84.46 a barrel by 0958 GMT, after hitting an intraday high of $84.62 and settling at $83.76 a barrel on Wednesday, the highest close since October 2008. London ICE Brent climbed 73 cents to $83.43. Crude oil futures will not trade on Friday in either New York or London because of the Easter holiday.
“Upward momentum is very strong,” said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt. “The market is rising even with a stronger dollar and even after what were bearish figures on US inventory levels. Money is flowing into commodities at the beginning of the new quarter from all sorts of investors, including funds.”
Oil prices dipped briefly on Wednesday after government data showed US crude inventories rose by 2.9 million barrels to 354.2 million barrels last week, their ninth straight gain.
Gasoline stockpiles logged a modest but unexpected gain. But the market soon returned to strength. “We suspect that with the dollar no longer rallying, (at least for now), commodity markets have been able to build a head of steam. In addition, simmering geopolitical tensions could also be at work,” said Edward Meir at brokers MF Global. He said talk of a possible new round of sanctions against Iran, maybe within weeks rather than months, could be underpinning the market.
