Oil climbs towards $83 as dollar weakens

Million barrels is the drop in oil in floating storage from its peak in November 2009. (AFP)

Oil rose towards $83 yesterday as the dollar weakened, approaching the high for the month of March on optimism about the global economic recovery.

US crude for May delivery gained 44 cents to $82.61 a barrel at 0722 GMT, while Ice Brent rose 47 cents to $81.64 in London.

Prices have traded in a range between $69 and $84 this quarter, touching $82.78 on Monday, the highest intra-day price since March 18.

A falling dollar this week has boosted the purchasing power for dollar-denominated commodities outside the US, reflecting the usual inverse correlation between the US currency and oil.

"The one thing that might help the oil price this week is what may well be seen as confirmation of the international economic recovery," said David Moore, Commodity Strategist at the Commonwealth Bank of Australia in Sydney.

The US non-farm payrolls probably increased in March, boosted by hiring for the decennial census and a snapback from February's weather-related losses, a Reuters survey showed ahead of Friday's report.

US crude inventories probably climbed by 2.6 million barrels last week, posting their ninth consecutive weekly increase, a Reuters poll showed on Monday.

 

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