A pledge by European Central Bank president Mario Draghi to “do whatever it takes to preserve the euro” supported the single currency as well as crude prices in Asia Friday, analysts said.
New York’s main contract, light sweet crude for delivery in September, was up nine cents to $89.48 a barrel and Brent North Sea crude for September delivery gained five cents to $105.31.
Draghi’s rousing vow of support for the single European currency issued late Thursday inspired crude traders to enter the market again, analysts said.
“Markets cheered after European Central Bank president Mario Draghi said yesterday that the ECB is ready, within its mandate, ‘to do whatever its takes to preserve the euro’,” DBS Group Research said in a report.
Draghi’s statements helped boost the euro against the dollar, lending support to dollar-priced oil.
The euro was trading at $1.2277 in early Asia trade Friday from $1.2280 in overnight trade. The single currency had climbed to a two-week high of $1.2330 following Draghi’s pledge.
Draghi’s remarks also fuelled speculation the ECB would make further bond purchases to help bring down high sovereign borrowing costs, particularly for Italy and Spain.