Oil Rises for Fifth Day as Rally Continues
By Alison Sider and Sarah McFarlane
Oil's rally continued to gather steam Friday, with prices rising for a fifth straight day to fresh three-year highs as investors continued to bet on rising demand and tighter supplies.
U.S. crude futures settled up 50 cents, or 0.78%, at $64.30 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, rose 61 cents, or 0.88%, to $69.87 a barrel on ICE Futures Europe.
Prices have climbed more than 50% since June last year, and both benchmarks have posted gains for four straight weeks, propelled by geopolitical tensions, supply disruptions and production cuts by the Organization of the Petroleum Exporting Countries. More recently, prices have been boosted by extremely cold weather in the U.S. and China, along with questions about whether the Trump administration would reinstate some sanctions on Iran.
"Every time it sells off it has a knack for coming back," said Ric Navy, Senior vice president for energy futures at RJ O'Brien & Associates LLC, adding that it is "not out of the question" that U.S. crude prices could hit $70 a barrel soon, with few willing to stand in the way of relentlessly rising prices.
A weaker U.S. dollar has also helped lift oil prices Friday. The ICE Dollar Index sank to its lowest level in more than three years Friday, driven by expectations of monetary-policy tightening. A weaker U.S. currency makes dollar-traded oil less expensive for foreign buyers, and so its price tends to rise as the dollar falls.
"I think the story here is really dollar driven and demand driven," said J. Alexander Blackman, an executive at Standard Delta Co., a commodities-trading and energy firm.
Oil prices had edged lower in earlier trading Friday, after news that the administration extended sanctions relief under the landmark 2015 Iran nuclear pact, keeping the agreement intact for several more months. That eased worries of a supply disruption that had helped push prices higher this week.
Data from China showing a fall in monthly crude imports also weighed on prices in earlier trading.
But the market shook off the bearish data, a sign that the recent rally is likely to keep going, analysts and brokers said.
"For those hoping for an end to the bull market, it's probably a good idea to wait a few days before calling an end to the rally," analysts at TAC Energy said.
Gasoline futures rose 1.25 cents, or 0.68%, to $1.8495 a gallon. Diesel futures rose 0.83 cent, or 0.4%, to $2.0850 a gallon.
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