Light oil price trading up towards $76 on weaker US dollar

Light oil price is trading up towards the $76 a barrel mark on Monday, after shedding nearly $1 in the previous session, as positive US jobs data buoyed hopes that energy demand in the world’s largest fuel consumer would soon improve.

The US dollar edged lower on Monday after surging during the previous session in its strongest performance in nearly a year against a basket of currencies after data showed the United States lost far fewer jobs than expected last month, and cuts in September and October payrolls were also revised lower. The gains in the US dollar depressed commodities although industrial raw materials were less affected than gold.

The forward crude oil futures for WTI is steepening with the 24th month contract last traded at $90.05 versus 89.74 on December first, while the front month has fallen 4.3% from $79.04 this month.

“The market is still pretty confident of demand in the future, in fact the forward curve is widening as a result of selling of the prompt-dated contract,” a trader in Singapore said.

Looking ahead to the end of the week, a raft of Chinese data including import numbers will offer more guidance, with expectations for crude oil imports to remain high. Sentiment also saw a boost after oil ministers from Arab producers said they were comfortable with current prices and several on Friday saw no need for OPEC to change its output targets when it meets in Angola this month.

Tags:  light oil price, US dollar, WTI