Crude Oil Rebounds from Five-Week Low as Stock Market Advances
Source: Bloomberg, Mark Shenk (4/21/09)
"Crude prices gained as much as 1.1% as financial share led U.S. equities higher."
Crude prices gained as much as 1.1% as financial share led U.S. equities higher. Energy prices also increased as the euro gained against the dollar, bolstering the appeal of commodities as an alternative investment. The May contract, which expires today, is less expensive than for the following months, allowing buyers to profit from storing oil.
"Both the May and June contracts were pretty oversold, so were ready to consolidate," said Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut. "The equity markets are higher and the dollar is giving back some of its recent gains. None of this is particularly germane to the oil business but it's giving the market a lift."
Crude oil for May delivery rose 32 cents, or 0.7%, to $46.20 a barrel at 12:05 p.m. on the New York Mercantile Exchange. Prices declined as much as $2.05, or 4.5%, to $43.83, the lowest since March 16. The more-active June futures contract increased 25 cents, or 0.5%, to $48.76.
Brent crude oil for June settlement increased 30 cents, or 0.6%, to $50.16 a barrel on London's ICE Futures Europe exchange.