Oil prices down after India rate hike

22 March 2010

Written by Bob Burton

Crude oil prices threatened to dip below $80 (£53.75) a barrel this morning (March 22nd) after India's central bank raised interest rates.

The announcement late last week hit energy, metals and stocks across the board as traders anticipated a slackening of the pace of global recovery.

The rate decision sent the dollar higher, which also made commodities such as crude and heating oil less attractive to foreign traders.

Speaking to Bloomberg, Toby Hassall, research analyst at CWA Global Markets in Sydney, said that a retraction of fiscal stimulus measures around the globe could further dampen recovery.

"It's going to either take some time or a string of pretty positive economic data to take us out of this range," he commented.

Heating oil prices were also down on the New York Mercantile Exchange this morning, with the near-term delivery contract trading around $2.065-a-gallon mark as European markets opened.

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