This is explained by many factors such as geopolitical tensions or the exceptional weakness of the dollar as it reached a record level of $1.43 against the euro.
As we will see here, to some analysts, oil prices are due to keep on increasing and might reach $100 quite quickly.
According to the Financial Times :
Crude oil prices on Friday rose to a fresh all-time high above $90 a barrel as the US dollar sunk to a new low against the euro.
Persistent worries about tight supplies ahead of the winter peak season and fresh geopolitical tensions also helped to push prices higher.
Nymex November West Texas Intermediate hit $90.02 a barrel in overnight trading. It closed $2.07 higher in New York at $89.47, a sixth straight trading day that oil set a record high. In Europe, the WTI contract opened 10 cents higher at $89.57.
The dollar traded on Friday to $1.4303 against the euro, after touching earlier a record low of $1.4311. Investors are betting on a further interest rate cut when the Fed meets.
A lower dollar suggests that producing countries, such as Saudi Arabia, may try to keep the oil price higher to compensate for more expensive imports priced in other currencies.
The strength of the euro, sterling and other currencies also mean that some countries, particularly in Europe, are partially insulated from the oil price rally.
David Moore, a commodity strategist at the Commonwealth Bank of Australia in Sydney, said: ”The dollar fell to new lows overnight. That fact has been a boost to all commodity prices.”
Nauman Barakat, senior vice-president at Macquarie Futures in New York, warned that traders have built massive December options calls – rights to buy oil at a certain price – at $90 and $100 a barrel, providing the backdrop for ”additional upward impetus.”
Kevin Norrish of Barclays Capital said that the issue no longer seemed to be whether oil will reach $100 a barrel, but when.
”Until there is a clear prospect of the [supply-demand] gap being filled, then the course is set for the market to take out $90, $100 and $110 in fairly quick succession,” Mr Norrish said.
The Organisation of the Petroleum Exporting Countries, which controls 40 per cent of the world’s crude oil output, denies that the market is tight, instead blaming speculation, the weakening of the dollar and Middle East tensions for the 13 per cent jump in prices in the past week.
- The Financial Times : Oil jumps above $90 a barrel
En Français :
- Le Figaro : Le pétrole dépasse les 90$ ;
- Les Echos : Pétrole, le prix du baril a dépassé les 90 dollars pour la première fois à New York.