Print this Story
SINGAPORE – Oil prices rose above $72 a barrel Tuesday in Asia as a weakening U.S. dollar offset concerns about the strength of the global economic recovery.
Benchmark crude for March delivery was up 38 cents at $72.27 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract gained 70 cents to settle at $71.89 on Monday.
Traders often buy commodities such as oil as a hedge against inflation and a weaker dollar and sell them when the U.S. currency rises. Oil, which is priced in dollars, become less expensive in other currencies when the greenback weakens.
The euro rose to $1.3724 on Tuesday in Asia from $1.3650 on Monday.
Investors nonetheless remain concerned about swelling debt levels in Europe, high unemployment in the U.S. and fears of Chinese monetary tightening continue to cast doubt over the global economic recovery.
"Geopolitical tension, ongoing financial risks from Greece, Portugal and Spain and further liquidation of speculative long positions will continue to weigh on the oil price," ANZ Banking Group said in a report.
Crude demand remains sluggish despite support from cold weather in the U.S. northeast.
Analysts expect U.S. crude stocks to grow 2 million barrels, according to a survey released Monday by Platts, the energy information arm of McGraw-Hill Cos.
In other Nymex trading in March contracts, heating oil fell 0.1 cent to $1.8845 a gallon, and gasoline was down 0.5 cent at $1.8893 a gallon. Natural gas rose 3.9 cents to $5.44 per 1,000 cubic feet.
In London, Brent crude was up 45 cents at $70.57 on the ICE futures exchange.
