The American Petroleum Institute (API) said oil supplies dropped 3.13 million barrels to 370.7 million last week. Additional support for crude prices came as the dollar decreased to the lowest level against the euro since March 2009, bolstering demand for commodities as an alternative investment.
“We saw some gains in the price in reaction to the API decrease,” said Ken Hasegawa, a commodity derivative sales manager at brokers Newedge in Tokyo. “$60 is the main resistance so it may be tough to go higher.”
“The major play seems to be the weakening dollar,” said Mike Sander, an investment adviser at Sander Capital Advisors Inc. in Seattle. “If the dollar continues to weaken to $1.40 euro or worse, oil will be pressured to go higher.”
The dollar traded at $1.3686 per euro at 9:09 a.m. in Tokyo, after falling 0.5% on May 12, 2009 and touching $1.3707, the weakest level since March 23, 2009.
Brent crude oil for June 2009 settlement increased as much as $1.10, or 1.9%, to $59.04 a barrel on London’s ICE Futures Europe exchange at 10:42 a.m. in Singapore. It declined 0.8% to end the session at $57.94 a barrel on May 12, 2009.
