Brent oil trading over $80, European markets help lift prices

Brent oil prices are trading over the psychological $80 mark on Monday and are up over two percent as Asian and European stock markets rally and the US Dow Jones is set to follow suit.

In London, Brent crude oil futures for September 2010 delivery broke through the $80 mark and was at $80.04 a barrel 14.00 GMT on the ICE Futures Exchange.

Brent prices have had a strong start to the week which will please oil bulls, but what’s going on with the US dollar?

The second half of 2010 could prove a difficult investor environment as the US dollar is loosing ground to most other important currencies, in the case of GBP sterling, which this morning rose to a five and a half month high against the dollar, at $1.5764.

ICE Dollar Index down over 8 Percent Since June

The ICE US Dollar Index has dropped 8.3% off its early June high of 88.71 and looks like it has further to fall.

Meanwhile, a new weather system nearing the south eastern Caribbean has a 90 percent chance of strengthening into a tropical depression, the National Hurricane Center said.

With higher global stock markets, together with a weaker dollar and with the hurricane season at mid-flight, it’s easy to see how oil prices should move higher from here.