Crude Oil Surges Over 2% On Weak Dollar

(RTTNews) - U.S. crude oil surged to end sharply higher for a fourth straight session Tuesday, with the dollar trending lower after some soft New York manufacturing activity data and ahead of the weekly oil report from the Energy Information Administration.

With markets were closed on Monday on account of the Presidents Day holiday, the supply data from the American Petroleum Institute will be available only late Wednesday and the official Energy Information Administration report on Thursday.

Light Sweet Crude Oil futures for March delivery, the most actively traded contract, jumped $2.13 or 2.1 percent to close at $102.43 a barrel on the New York Mercantile Exchange Tuesday.

Crude prices for March delivery scaled a high of $102.07 a barrel intraday and a low of $100.23.

Natural gas futures soared Tuesday, with demand for heating oil shooting up as northeastern U.S. was hit by a another winter storm. Natural gas for March delivery settled at $5.55 mBtu, up $0.34 or 6.5 percent from $5.214 mBtu on Friday.

Last week, crude oil continued to trend above $100 a barrel amid signs of increased global demand for energy products. The International Energy Agency indicated global inventories at a 5-year low.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.01 on Tuesday, down from its previous close of 80.16 late Friday in North American trade. The dollar scaled a high of 80.23 intraday and a low of 79.96.

The euro traded higher against the dollar at $1.3757 on Tuesday, as compared to its previous close of $1.3707 late Friday in North America. The euro scaled a high of $1.3770 intraday and a low of $1.3696.

In economic news, confidence in the home building sector in the U.S. deteriorated lately, an industry survey showed Tuesday. The National Association of Home Builders said its housing market index slipped to 46 in February compared to a reading of 56 last month. Economists expected the measure to remain steady.

From Europe, consumer price inflation in the U.K. dropped below the 2 percent target for the first time since November 2009, giving room for the Bank of England to leave its record low interest rates unchanged for some more time and avoid any rate hike that risks economic recovery. Factory-gate inflation also moderated in January, reflecting decreases in petroleum and pharmaceutical products.

Consumer price inflation in the U.K. eased to 1.9 percent in January from 2 percent in December, the Office for National Statistics said Tuesday. The rate was expected to remain at 2 percent.

Meanwhile, Germany's investor confidence deteriorated for the second straight month in February, reversing the improving trend seen in recent months, amid concerns over the faltering recovery in emerging market economies and the subdued outlook for the U.S. recovery. The indicator, which measures investors' views of the economy over the next six months, dropped to to 55.7 in February from 61.7 in January, a survey by the Centre for European Economic Research/ZEW revealed Tuesday. Economists expected the score at 61.5.