Crude Gains on Weak Dollar, Spain Bailout
NEW YORK--U.S. crude-oil futures settled higher Friday, rebounding from four straight losing sessions as the dollar weakened against the euro and broader markets rose.
The gains came as the front-month contract switched to November futures. Light, sweet crude oil for November delivery rose 47 cents, or 0.5%, to settle at $92.89 a barrel on the New York Mercantile Exchange.
Brent crude oil on the ICE futures exchange for November delivery rose $1.50 to $111.53 a barrel.
Oil gained in tandem with stock markets and other commodities such as copper and wheat, pushed by a stronger euro over the U.S. dollar. The Financial Times reported the European Commission and Spain are moving toward changes that would meet the demand of lenders.
A weaker dollar typically helps raise oil prices by making crude oil cheaper for buyers using other currencies.
"Bailouts are bullish," said Phil Flynn, an analyst at Price Futures Group in Chicago. He added the sharp fall in crude-oil prices over the past week likely prompted the rebound as well. "Because of the precipitous price drop, maybe we were too low."
Europe's debt crisis has kept oil traders' attention for months, and aided the latest rally this summer after European Central Bank President Mario Draghi pledged to do whatever it takes to save the euro.
Oil has rallied from lows under $80 a barrel in June on hopes Europe's crisis is abating. The Federal Reserve's decision to provide a new round of stimulus also buoyed crude oil's price.
More recently, as prices approached $100 a barrel, many investors became nervous futures had risen too high and were set for a decline.
Futures fell 6.2% this week after the October contract settled at a one-month low Thursday.
Wednesday, a report from the U.S. Energy Information Administration said U.S. oil stockpiles rose by 8.5 million barrels last week, well above analysts' estimates. The sharp supply increase prompted many investors to close out bullish bets.
Still, supplies of products such as gasoline and diesel remain tight, keeping prices for the fuels elevated.
Front-month October reformulated gasoline blendstock, or RBOB, settled 3.85 cents higher at $2.9425 a gallon. October heating oil settled 2.32 cents higher at $3.1207 a gallon.
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