SINGAPORE, Oct 14 – Oil rose further in Asian trade Wednesday, extending overnight gains after the dollar fell to a new 2009 low against the euro, analysts said.
Renewed hopes of stronger energy demand driven by signs of global economic recovery and the arrival of cold weather in the United States, the world\’s largest oil user, also lent support to crude prices, they said.
New York\’s main contract, light sweet crude for November delivery rose 90 cents to 75.05 dollars a barrel.
Brent North Sea crude for November delivery advanced one dollar to 73.40 dollars a barrel.
Expectations that the dollar will continue to languish against the euro and other major currencies will boost the crude market, analysts said.
"We expect a further fall of the US currency over the next two weeks," said Dariusz Kowalczyk, chief investment strategist with SJS Markets financial services firm in Hong Kong.
The euro hit a 14-month high against the dollar in Asian trade Wednesday, climbing to 1.4887 dollars compared with 1.4852 in New York late Tuesday.
With little reprieve seen for the dollar, investors have sought to protect themselves against the greenback\’s fall by buying hard assets such as oil and other commodities.
A struggling greenback tends to boost crude prices particularly because the dollar-denominated commodity becomes cheaper for foreign buyers holding stronger currencies.
Michael Malpede at Easy Forex said the move by investors into oil, gold and other commodities quoted in dollars weighed on the greenback.