Crude Oil Price Now Over 100$ per Barrel

In the end of February and beginning of March a series of new oil price record was reached. A quick look back gives such events as: “On Feb. 28, the April contract for benchmark US light, sweet crudes shot up to a record $102.97/bbl in intraday trading on the floor of the New York Mercantile Exchange before settling at a record closing of $102.59/bbl, up $2.95 for the day. “, “The May contract jumped $2.87 to $102.25/bbl.”, “On the US spot market, West Texas Intermediate at Cushing, Okla., was up $2.95 to $102.60/bbl.”, “Heating oil for March delivery escalated by 7.45¢ to $2.85/gal on NYMEX. The March contract for reformulated blend stock for oxygenate blending (RBOB) advanced 1.8¢ to $2.50/gal.”

The last week was no different and meant even new price records for a barrel of oil, over 110 dollar/barrel. The latest record was a flirt with 112 dollars/barrel (Upstream). Some claim this is a result of the weakened dollar and this might be a part of the explanation, however the oil price has risen significantly in euros too. Other see this as a sign of an even tighter oil market.

Iran has recently stopped using the American dollar as the dominating currency for its oil trade (Reuters). Venezuela has also started to make contracts in euros instead of dollar and this have been confirmed by the oil minister Fafael Ramirez (Rigzone). Several other countries have expressed similar intentions (Xinhua), (Kuwait Times). This could weaken the dollar even more and send oil prices even higher.