Oil rises over weaker dollar

Afp April 12, 2010

SINGAPORE: Oil prices rose in Asian trade on Monday as the euro firmed against the US dollar and on the back of indications of improved Chinese demand, analysts said.

New York's main contract, light sweet crude for delivery in May, added 46 cents to 85.38 dollars a barrel. Brent North Sea crude for May was up 50 cents to 85.33 dollars per barrel. "The euro has risen against the US dollar this morning and the Chinese trade data gave markets a more positive view on oil demand," said David Moore, a commodity strategist with the Commonwealth Bank of Australia in Sydney.

In Asian trade, the euro rose to 1.3642 dollars from 1.3497 late Friday after the 16 nations using the single currency unveiled a 30-billion-euro lifeline for debt-hit Greece. A weaker greenback tends to benefit dollar-priced oil because it becomes cheaper for buyers using stronger currencies, and therefore stimulates demand and prices.

Oil also received a boost from a report on Saturday which showed oil imports grew in China, the world's second-largest energy consumer, by 29 percent in March this year compared to the previous year. China imported 4.98 million barrels a day, according to preliminary data from the General Administration of Customs, while net imports were 20.8 million metric tonnes.

Oil had risen to 18-month highs after climbing above 87 dollars last week as investors bet on better demand prospects amid signs of a strengthening economic recovery.  But on Thursday and Friday, the market pared its gains, as traders fretted over Greece and a disappointing US jobs report that reminded investors of the rocky road to economic recovery