Oil moves higher as US stock piles rise
Friday, 24 November 2006Oil rose towards $60 a barrel this evening, drawing strength from a disruption to supply in Nigeria and as a fall in the US dollar boosted other commodities.
The price of oil had dropped nearly $1 on Wednesday after a US government report showed crude stocks rose a more-than-expected 5.1 million barrels last week, adding to ample supplies.
Late this afternoon US crude was up 70 cents at $59.94 a barrel. London Brent gained 76 cents to $60.11.
Prices are vulnerable to wider fluctuations as the New York Mercantile Exchange is shut for the two-day Thanksgiving holiday while electronic trade is continuing, leaving trade thinner, and a fall in the US dollar today boosted the price of precious metals such as gold.
Oil's descent from a record of $78.40 hit in July prompted the Organization of Petroleum Exporting Countries in October to cut oil output by 1.2 million barrels per day from November.
Prices over the past few weeks have dipped below $55 before rebounding to around $60 despite big US inventories and warm winter in the US suppressing demand.
