Commodity Corner: Oil Hits $76
The price of a barrel of crude oil for November delivery took a proverbial roller-coaster ride Wednesday.
Thanks to the Federal Reserve's announcement earlier this week that it was prepared to buy U.S. debt—that is, print more money—in an attempt to stimulate the economy, the dollar weakened against the euro Wednesday. The stronger euro helped crude oil futures surge $2.48 to $76.00 a barrel. However, a U.S. Department of Energy report showing a 900,000-barrel increase in the country's commercial crude oil stockpile had a dampening effect. Ultimately, crude ended the day at $74.71—a $1.19 improvement from Tuesday and a 61-cent gain from the intraday low.
The front-month contract for natural gas gained a nickel to settle at $3.97 per thousand cubic feet Wednesday. The bump in gas prices stems from the presence of a tropical system that could become a threat to oil and gas infrastructure should it enter the Gulf of Mexico. The National Hurricane Center reported Wednesday that that there is a high (60%) chance that an area of low pressure over the south-central Caribbean will become a tropical cyclone by Friday afternoon.
Out in the Atlantic, Tropical Storm Lisa was packing maximum sustained winds of 45 miles per hour and moving slowly eastward over a relatively cool area of water. Forecasters expect Lisa to strengthen a bit but then deteriorate over the next few days.
Natural gas traded within a range from $3.91 to $4.01.
Gasoline settled two cents lower at $1.90 a gallon Wednesday. The October contract price fluctuated between $1.88 and $1.93.