Weaker dollar boosts oil prices

PanARMENIAN.Net - A weaker dollar boosted oil prices Tuesday, Sept 4 even as a resumption of refinery operations in the Gulf of Mexico in the aftermath of Hurricane Isaac eased concerns over supply disruptions, AP reports.

Benchmark crude for October delivery was up 79 cents to $97.26 per barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract rose $1.85 to finish at $96.47 Friday. There was no closing price Monday because of a public holiday in the U.S. Brent crude was up 15 cents at $115.93 on the ICE Futures exchange in London.

Hopes that the European Central Bank will play a more crucial role in resolving the continent's debt crisis have helped support the euro against the dollar. After dropping to near two-year lows below $1.20, the euro has pushed back above $1.26. That pushes up the price of oil, which is traded in dollars and becomes cheaper for holders of other currencies when the dollar drops.

Oil analyst Stephen Schork said in a report that oil prices could see "increased volatility this week" due to the loss of a trading day Monday because of a holiday in the U.S.

The release Friday of U.S. nonfarm payrolls for August, a closely watched gauge of employment in the world's No. 1 economy, also could impact prices, Schork said. He attributed recent swings in the oil price to the conflicting influences of a lower dollar and refinery disruptions in the U.S. Gulf Coast that resulted from the hurricane.

While a substantial amount of oil and gas production remains offline, production is coming back as expected. No major damage to oil platforms or refineries has been reported.

In other energy futures trading, heating oil rose 2.8 cents to $3.21 a gallon and wholesale gasoline was up 2.5 cents at $2.997 a gallon. Natural gas rose 0.3 cent to $2.802 per 1,000 cubic feet.