Oil jumps as dollar dives, crude up 19 percent in four days

Tue Feb 3, 2015 5:25pm EST
 
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By Barani Krishnan

NEW YORK (Reuters) - Oil prices ended up again on Tuesday as a tumbling dollar sent most commodities rallying, bringing crude's four-day rise to about 19 percent, its biggest such advance since January 2009.

Despite signs that U.S. crude supplies had registered another heavy build last week, investors were more confident that oil prices have hit a bottom after a seven-month rout. Traders said oil bulls were encouraged by BP's plan to cut capital expenditures 13 percent in 2015, which came after reductions announced by other major energy companies.

Benchmark Brent crude oil LCOc1 settled up $3.16, or nearly 6 percent, at $57.91 a barrel. It rallied as high as $59 for the first time since end of December.

U.S. crude CLc1, or WTI, finished up $3.48, or 7 percent, at $53.05, after a session high at $54.24.

But Brent and WTI gave back about $1 each in post-settlement trade, after industry group American Petroleum Institute estimated U.S. crude stockpiles had risen more than 6 million barrels last week, in a fifth straight week of builds.[API/S]

Worries about a global oversupply in oil led to a 60 percent crash in crude prices between June and late January.

In the last four sessions, however, Brent and WTI gained about $9, or 19 percent. The rally began on Friday, when oil services firm Baker Hughes said the number of U.S. oil drilling rigs had its biggest weekly decline in nearly 30 years.

"You've got a number of themes working to push the market higher," said Phil Flynn, an analyst at Price Futures Group in Chicago.   Continued...

 
A gas station employee refuels a motorcycle in Brasilia November 7, 2014. REUTERS/Ueslei Marcelino