Crude prices up on spending figures

17 November 2009

Crude oil prices moved higher during trading on Monday (November 16th), with the New York Mercantile Exchange's headline contract gaining more than $2.50 (£1.48) to settle at $78.90 a barrel.

Speaking to Reuters, Phil Flynn, an analyst at PFGBest Research in Chicago, attributed the day's gains to increased confidence in the US economy after the publication of stronger-than-expected consumer spending figures for October.

Meanwhile, a weaker dollar also made crude oil and other commodities such as heating oil more attractive to foreign buyers.

"The main reason crude futures are up today is the weaker dollar. The greenback fell as money traders were selling the greenback in the face of better US retail sales and business inventories," said Mr Flynn.

Official figures published yesterday showed a 1.4 per cent growth in total consumer spending last month, helping to boost confidence after the 2.3 per cent slump seen in September. Much of the boost has been attributed to
strong vehicle sales.

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