Oil prices pushed higher for a second straight day yesterday even though the U.S. dollar strengthened and fresh economic data gave mixed signals about demand for oil.
Benchmark crude for December delivery rose 24 cents to settle at $79.14 US a barrel in afternoon trading on the New York Mercantile Exchange. As well, the euro dropped back below $1.49 US yesterday after banking officials in Europe and the U.S. voiced support for the dollar.
A falling U.S. dollar has helped drive oil prices after crude bottomed at $32 a barrel nearly a year ago. Because crude is traded in U.S. dollars, an investor can trade euros for dollars and then buy oil for a relative bargain.
Industrial production for October rose less than expected, suggesting the economic recovery -- and oil demand -- will continue to be bumpy.
Oil has traded in a range of $75 to $82 US in recent weeks.
Demand for oil continues to be weak and supplies are more than ample, and that is keeping oil prices restrained as prices for other commodities, such as gold, continue to climb because of the weaker dollar, PFGBest analyst Phil Flynn said.
