Oil gains fresh fillip from weak dollar


LONDON: Oil rose for a second straight session on Monday, boosted by the dollar’s continuing fall against a range of currencies, which outweighed news that China had tightened its monetary policy. Prices touched a five-month intra-day high of $84.43 last week.
Weakness in the greenback boosts the dollar value of oil, which is usually traded in the US currency.
Oil was “in a kind of win-win situation”, where weak economic data supported prices by increasing expectations, but strong economic data boosted oil by bolstering expectations of economic growth. Weak US jobs data on Friday firmed expectations for further monetary stimulus to boost the struggling economy.
Iran increased its official reserves estimate by 18 billion barrels to 150 billion barrels.
The move followed the decision a week ago by Iraq, to raise its reserves figure to 143 billion barrels.
However, Olivier Jakob of consultants Petromatrix, was skeptical that Iran’s news would have much effect on oil prices, saying: “Everything out of Iran is taken with a pinch of salt.” Oil has stayed in a price range of $70 to $80 a barrel for most of this year – judged by OPEC to be high enough for producers who need to invest.