Oil prices dip

Crude oil was trading near to the $USD100 (€64.18) a barrel level today as a stronger dollar tempted investors away from commodities.

Prices set record highs of just under the €USD112 (€71.88) mark last week, but today light sweet crude for May delivery was 0.57 cents lower at USD$100.30 (€64.38) a barrel.

The drop came as the dollar strengthened slightly in value, with €1 worth USD$1.56 compared with last week’s record high of USD$1.59 (€1.02). And the pound eased to USD$1.99 (€1.28), also down from recent levels of more than USD$2.03 (€1.30).

Analysts said the shift came as some speculators sold up positions over concerns that a slowing US economy would dampen crude oil demand.

But there was a warning that the recent surge over the past weeks could happen again if there are further interest rate cuts in the US – making the dollar less attractive.

David Moore, a commodity strategist with the Commonwealth Bank of Australia in Sydney, said: “It’s quite possible for the conditions that have pushed oil prices higher to be re-established.

“US interest rates are low and they will be cut further.”

UK drivers have been warned if oil prices are established at above the 100 dollar a barrel mark they face further record fuel prices going into the spring.

Latest figures from the AA show that forecourt petrol prices have risen by an average of 2.8p per litre to 106.8p this month. Diesel has also added 5p to 114.3p.

The AA said it was now costing a two-car family an extra £37 (€47.34) to fill up compared to last year.