Oil futures rise as US stocks see biggest drop since 2008

9 August 2010 9 August 2010

BonTrade

Oil futures are poised to gain this week as the US has the biggest drop in crude oil stocks since 2008, while the US dollar weakens further against most other main currencies.

US Oil Stocks See Big Drop

Crude oil imports to the US Gulf Coast fell 23 percent in the week ended July 30th from the previous week, the Energy Department reported August 4th. That was the biggest drop since September 2008. Crude oil stocks fell 2.78 million barrels to 358 million barrels, the US government said.

ICE Dollar Index Slips Lower

The ICE Dollar Index, which tracks the US dollar against the currencies of six major US trading partners including the euro, yen and pound, was at 80.38 after falling to as low as 80.09 last week, which was the lowest since April 2010.

Meanwhile, hedge funds last week boosted their holdings of crude oil futures and options to the highest level in thirteen weeks in a bet that Tropical Storm Bonnie would delay imports to states along the Gulf of Mexico, reducing supplies.

“The bullish news is they’re buying it and that’s good for oil prices.” said Tim Evans, an energy analyst at City Futures Perspective in New York.