Oil prices stabilised Friday as the White House's $17.4 billion auto industry rescue package gave Wall Street a boost and the dollar strengthened against the euro. Light, sweet crude for February delivery rose 92 cents to $42.59 a barrel on the New York Mercantile Exchange. The contract overnight fell $2.94 to settle at $41.67. The January contract, which expires Friday, fell 82 cents to $35.40, but fell as low as $33.44, a price last seen more than four years ago.
Analysts are largely discounting the January price, with the volume of the next month contract trading at 13 times the volume. Yet analyst Jim Ritterbusch said pre-expiration lows do provide a downside target to the next contract.
Ritterbusch, president of energy consultancy Ritterbusch and Associates, said the market is sending strong signals that an oversupplied market will remain in place for some time. "I think it's going to work its way down to today's lows in the January futures," he said.
In London, February Brent crude rose 18 cents to $43.54 barrel on the ICE.
The extreme volatility in energy markets this year, which have seen crude pushed from $100 to $150 between January and July, and back down to $33 this month, has become an urgent global issue. At an energy summit Friday on London, British Prime Minister Gordon Brown warned that a failure to stabilise oil prices could cost the global economy trillions. AP
Analysts are largely discounting the January price, with the volume of the next month contract trading at 13 times the volume. Yet analyst Jim Ritterbusch said pre-expiration lows do provide a downside target to the next contract.
Ritterbusch, president of energy consultancy Ritterbusch and Associates, said the market is sending strong signals that an oversupplied market will remain in place for some time. "I think it's going to work its way down to today's lows in the January futures," he said.
In London, February Brent crude rose 18 cents to $43.54 barrel on the ICE.
The extreme volatility in energy markets this year, which have seen crude pushed from $100 to $150 between January and July, and back down to $33 this month, has become an urgent global issue. At an energy summit Friday on London, British Prime Minister Gordon Brown warned that a failure to stabilise oil prices could cost the global economy trillions. AP
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