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Oil above $79 amid dollar volatility

Oil above $79 amid dollar volatility

Oil prices rebounded Tuesday after three straight days of declines, offsetting an unexpected slump in consumer confidence while tracking changes in the dollar's volatile exchange rate.
At midday, Benchmark crude for December delivery rose 91 cents to $79.59 a barrel on the New York Mercantile Exchange. The contract fell $1.82 to settle at $78.68 on Monday.
Crude jumped to a 12-month high at $82 a barrel last week as the dollar weakened amid concerns that massive global stimulus spending will eventually spark inflation. Since oil is priced in dollars, a drop in the U.S. currency makes oil prices rise.
The dollar was choppy in Tuesday trading after a report showed U.S. consumers' confidence dropping this month, raising doubts about the vitality of the economy's recovery. The 16-nation euro dropped to $1.4812 in morning New York trading from $1.4859 late Monday.
Economists watch consumer confidence because spending on goods and services by Americans accounts for about 70 percent of U.S. economic activity by federal measures. Recent economic data, from housing to manufacturing, has offered mixed signals but some evidence that an economic recovery might be slow.
A weakening dollar could put significant pressure on dollar-denominated oil prices. Some economists expect the dollar and oil to stabilize over the next three to six months as inflation fears ease.
In other Nymex trading, heating oil rose 1.6 cents to $2.0498 a gallon. Gasoline for November delivery advanced 1.2 cents to $2.0459 a gallon, while natural gas for November delivery rose 4 cents to $4.55 per 1,000 cubic feet.
In London, Brent crude for December delivery rose 26 cents to $77.52 on the ICE Futures exchange.
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Associated Press writers Pablo Gorondi in Budapest and Ashley M. Heher in Chicago contributed to this report.


Updated : 2021-02-25 05:15 GMT+08:00