OIL FUTURES: Oil Hits New 18-Month High

Source: WSJ

OIL FUTURES: Oil Hits New 18-Month High On Strong Economic Growth

By Edward Welsch
Of DOW JONES NEWSWIRES

Crude oil futures traded surged above $87 per barrel Monday, reaching a new 18-month high, as signs of rising economic recovery around the world suggested even higher oil prices to come.

Light, sweet crude for June delivery rose 80 cents, or 0.9%, in recent trading to $86.95 a barrel on the New York Mercantile Exchange, retreating slightly after reaching a new post-downturn high of $87.15 a barrel. Oil prices rose along with strong manufacturing data reported by the U.S. and China.

Longer-dated contracts and the Brent oil contract tied to European oil supplies rose even higher, as the Nymex front-month contract was weighed down by a glut of supply in the U.S. The July Nymex contract recently traded at $89.68 a barrel, a $2.73-per-barrel premium over the June contract, and the Brent contract on the ICE futures exchange recently traded at $89.38 a barrel, up $1.94 or 2.2%.

"I think the market is sending a warning that we might see higher inflation in oil down the road," said Phil Flynn of PFGBest in Chicago. "The economy is getting stronger again and with that comes increased consumption of oil."

China reported the 14th straight month of expansion in its manufacturing sector Monday, while the U.S. also reported increases in manufacturing and construction activity. Those factors outweighed news that China would increase its reserve requirements for lenders by 50 basis points, which caused a temporary slump in oil prices in overnight trading.

Fears about the potential effect of a massive spill from the BP PLC (BP) Deepwater Horizon oil rig in the Gulf of Mexico also supported oil prices Monday. While the Louisiana Offshore Oil Port has so far said shipments will not be affected, even an outside risk that the nation's largest oil import facility will be disrupted helped push prices higher.

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Read more: http://online.wsj.com/article/BT-CO-20100503-709707.html?mod=rss_Commodities

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guess the scum vultures (apologies to actual vultures) are likin' what they see in terms of the massive oil spill's affect on "the markets..."

.........happens, no matter how small (in oil terms not environmental terms) the incident is, the price of oil "magically" rises. Obama better slap the shit out of these speculators, because if he doesn't I for one am done with him.

Gas will be $4...

$.05 away from three here - jumped 13 cents in five hours (NE Indiana).

AGAIN.....

if oil hits 200, gas will be a lot more that 4 bucks. it was 4+ bucks at 140.

Oil companies want the friendlier Republicans back in control of Congress and will purposefully bring economic pain to voters to try to achieve this end.

Disaster Capitalism is a religion for Corporate America.

how else will BP pay for all the cost of clean up.

cut back again to pay for high gas prices.

It won't end until we the people step up and demand real regulation.

made money off of the spill. Then even more when they never paid the 5 billion dollar fine.