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Nigeria: Oil Price Rises to $102.6 Per Barrel
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Vanguard (Lagos)
26 March 2008
Posted to the web 27 March 2008
Adekunle Aliyu
Lagos
Oil prices surged by more than a dollar yesterday as traders switched investments away from the weak US currency and into commodities, analysts said.
Traders were, meanwhile, awaiting the latest snapshot of crude inventories in the United States, which is the world's biggest consumer of energy.
New York's main oil contract, light sweet crude for delivery in May, jumped by 1.38 dollars to $102.60 per barrel.
London's Brent North Sea crude for May gained $1.24 to $101.84.
"Oil futures were firmer, extending last night's gains amid persistent weakness in the US dollar and as investors were putting their money back into commodities," Sucden analyst Andrey Kryuchenkov said yesterday.
"Just as it happened before, the dollar weakness prompted market participants to put their money into dollar denominated commodities, as they become relatively cheaper for foreign investors, while some use commodities as a hedge against inflation," he added.
Later yesterday, the US government was to publish energy stockpiles data for last week. Analysts are forecasting that US crude inventories rose by 1.8 million barrels in the week to March 21.
"There could always be a surprise in the stockpiles report, and the market is focusing on that now," said Tony Nunan, of Mitsubishi Corp's international petroleum business in Tokyo.
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Although prices were rising yesterday, they remained far below all-time highs of almost 112 dollars per barrel reached last week.
Oil futures have been supported by long-term concerns over the ability of producers to meet rising energy demand from the developing world, notably China and India.
New York crude had hit a record intra-day high of 111.80 dollars on March 17, while London Brent scored an historic peak of $108.02 earlier this month.
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