Forexpros – Crude oil futures were higher on Tuesday, hovering close to the psychologically important USD100-a-barrel level as a broadly weaker U.S. dollar boosted the appeal of commodities and countered concerns over the uncertain short-term energy demand outlook in the U.S.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at USD99.66 a barrel during European morning trade, gaining 0.5%.
It earlier rose as much as 0.55% to trade at a daily high of USD99.72 a barrel.
The dollar slumped to a three-week low against the euro, while the dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was down 0.71% to trade at a three-month low of 73.78.
Oil prices typically strengthen when the U.S. currency weakens as the dollar-priced commodity becomes cheaper for holders of other currencies.
Late Monday, in an address from the White House, President Barack Obama said that the current debt standoff was a “dangerous game” but added that he was confident a compromise would be reached in Congress before the August 2 deadline to lift the country’s USD14.3 trillion debt ceiling.
In a speech following the President’s address, House Speaker John Boehner urged passage of a proposal from his Republican Party and warned of the consequences of a default.
Meanwhile, markets were awaiting fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of oil demand in the world’s largest oil consumer.
The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show stockpiles declined by 1.75 million barrels last week, while gasoline stockpiles were projected to rise by 0.1 million barrels.
U.S. oil supplies have declined in each of the past seven weeks, the longest run in nearly two years amid U.S. peak gasoline demand and the start of the Atlantic hurricane season.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for September delivery rose 0.52% to trade at USD118.31 a barrel, up USD18.65 on its U.S. counterpart.
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