Oil price jumps to fresh year high trading near $76

Light oil price reaches a fresh one year high near $76 a barrel Thursday trading in Asia on a weaker US dollar and growing investor optimism about an economic recovery.

Benchmark crude oil futures for November delivery was up 72 cents to $75.90, the highest since October 2008, by midday Singapore time in electronic trading on the NYMEX. The contract added $1.03 to settle at $75.18 on Wednesday.

Oil traders have fed off rising stock markets and a falling dollar this week to break out of a $65 to $75 trading range that has held since May. The Dow Jones industrial average rose 1.5 percent Wednesday to above 10,000 for the first time in a year on encouraging earnings reports from Intel Corp. and JPMorgan Chase & Co. Most Asian stock indexes gained in early trading.

Meanwhile, the euro rose to $1.495 in early Asian trading from $1.4933 the previous day while the dollar gained to 89.46 yen from 89.34. Oil is traded in US dollars and its price tends to rise when the dollar falls.

“There’s a perception that the economy is getting stronger and the dollar is getting weaker,” said Gerard Rigby, an energy analyst with Fuel First Consulting in Sydney. “But we haven’t seen a real improvement in demand just yet.”

US oil inventories fell unexpectedly last week, the American Petroleum Institute said late Wednesday. Crude stocks dropped 172,000 barrels while analysts had expected a jump of 2.2 million barrels, according to a survey by Platts, the energy information arm of McGraw Hill Cos.