Crude rallies for sixth day

30 December 2009

Crude oil prices continued to rally this morning (December 30th) as traders awaited the latest demand report from the Energy Information Administration (EIA).

A survey conducted by Bloomberg showed that analysts anticipate that crude oil supplies dropped by 1.85 million barrels in the US last week amid a demand recovery.

EIA data published in recent weeks has shown a sustained drawdown in crude oil stocks, while derivatives such as heating oil, propane and gasoline have also witnessed rising demand.

Gains have been broadly attributed to the persistent cold weather witnessed across the country, while improving economic conditions have also fuelled a recovery in industrial and commercial demand.

Speaking to Bloomberg, Clarence Chu, a trader with options dealer Hudson Capital Energy in Singapore, said: "Partly also, from this morning the dollar has come off. The dollar is still higher on the day but it has pulled back a little bit."

A weaker dollar traditionally makes hard assets such as oil more attractive to foreign investors.

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