Oil prices hit US$100 a Barrel for the first time
In the first trading day of 2008, NYMEX crude oil futures traded at US$100/b for the first time ever, powered by renewed violence in Nigeria, supply concerns, and ongoing tension in the Middle East, writes Global Insight Energy analyst, Andrew Neff.
After flirting with the symbolic US$100/b mark several times in 2007, only to fall back, NYMEX light, sweet crude oil yesterday soared to a new record, briefly hitting US$100/b before falling back to settle at US$99.62/b.
As International Hydographic & Seismic Search went to press, prices fell back below US$100/b, the gain of US$3.64/b on the day showed that, together with a degree of speculation and market sentiment to hit US$100, there is strong concern over oil supplies in such a tight market, allowing singular events to have an outsized impact on prices.
A weak US dollar, which makes oil more affordable for countries with stronger currencies, and continued strong demand are helping support a lofty price floor for crude.
Traders are looking ahead to a planned February OPEC meeting for signs that the cartel could boost production.
A seventh consecutive weekly decline in crude inventories could propel NYMEX prices emphatically to pierce the US$100/b psychological mark.l
For more information, visit www.reson.com
