Forexpros – Crude oil futures climbed to an eight-day high on Monday, as a broadly weaker U.S. dollar boosted the appeal of commodities after French and German leaders pledged to present new measures to tackle the region’s debt crisis.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in November traded at USD83.92 a barrel during European morning trade, gaining 1.13%.
It earlier rose by as much as 1.4% to trade at USD84.09 a barrel, the highest price since September 28.
After a summit in Berlin on Sunday, German Chancellor Angela Merkel and French President Nicolas Sarkozy said that they have reached an agreement to recapitalize European lenders, though few details were provided.
The package will be revealed by the end of the month, according to reports.
The announcement saw risk appetite recover, prompting investors to move in to riskier assets, such as commodities and high yielding currencies, dampening the appeal of traditional safe haven assets like the U.S. dollar.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.97% to trade at an eight-day low of 78.31.
Oil prices typically strengthen when the U.S. currency weakens as the dollar-priced commodity becomes cheaper for holders of other currencies.
Crude prices found further support as concerns over the U.S. economy eased after official data on Friday showed that nonfarm payrolls rose by 103,000 in September, nearly doubling expectations for a gain of 53,000.
Payrolls for the previous two months were revised up by a total of 99,000, while the unemployment rate remained unchanged at 9.1% as expected.
Oil traders have been paying close attention to readings on U.S. employment levels for signs that people are returning to work, thus driving more and using more energy.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for November delivery rose 0.39% to trade at USD104.56 a barrel, up USD20.64 a barrel on its U.S. counterpart.
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