Oil Prices Rising After Two-Month Low
Oil prices have once again seen a rise after falling to their lowest point in around two months and the biggest weekly decline in over a year, with speculations of a drop below the $100 per barrel mark looking to have been rather exaggerated. Oil futures increased by as much as 1.2% following a one-day drop of 8.6% yesterday, resulting from U.S economic data which was considerably worse than expected. The rate hit a figure which traditionally points to an imminent price increase, according to industry analysts, who also indicate that the instability could halt an aggressive sell-off begun yesterday.
Crude oil values for June delivery increased by up to $1.15 per barrel, marking a value of $100.95 in trading on New York’s Mercantile Exchange. Yesterday saw values fall by $9.44 to $99.80, which is the lowest since mid-March and the single largest percentage drop since April 2009. The relative strength index of crude oil, which is measure of how quickly prices are falling or rising, dropped to 32 yesterday, which is the lowest seen since August 2010. Readings close to 30 usually indicate that the commodity is imminently due to climb.
The US Dollar Index, which measures the currency against six of the world’s other key players, jumped by as much as 1.5% yesterday to around 74.12, which marks the biggest one day increase since October 2010. A stronger dollar value is also known to reduce attractiveness of commodities to investors, which across the board saw the largest drop since 2009.
