Oil settles above $80- experts ponder if level will hold
05 Jan 2010
Houston: After dithering in a narrow range for a considerable period of time, oil prices finally settled above $80. This was the highest close in nearly 15 months. On Monday, oil for February delivery climbed about 3 per cent to $81.51 a barrel, the highest settlement price since 9 Oct. 2008.
The rise was put down to exceptionally cold weather in the Northern Hemisphere, expectations of an improving economy and new tensions between Russia and Belarus.
Heating oil futures rose to the highest level in more than a year as cold weather was reported across much of Europe, China and the United States.
A number of positive signals from the economy have traders viewing the energy market with anticipation. Reports of increased manufacturing activity and passenger car sales in December are being looked upon as indications that the economy was on the mend.
Unemployment rates in the US fell to 10 per cent in November last year, from 10.2 per cent in October. The government is scheduled to announce December results later this week.
There is expectation that the economy will get better this year, and demand would inevitably follow.
