Heating oil edges toward $2 a gallon

23 November 2009

Heating oil prices rose in electronic trading on the New York Mercantile Exchange this morning (November 23rd), moving back towards $2 (£1.20) a gallon after losses at the end of last week.

The December-delivery heating oil contract tracked crude upwards this morning, with both energy commodities gaining more than one per cent during the Asian trading session.

Gains have broadly been attributed to weakness in the dollar, which dropped against the euro for the first time in three days amid renewed speculation that the US Federal Reserve will keep interest rates at near-zero levels until well into next year.

Toby Hassall, research analyst at CWA Global Markets in Sydney, told Bloomberg that commodities traders are also confident demand for crude and associated products is beginning to pick up in the US.

However, he added that a "significant downward thrust" in the dollar may be necessary for crude to climb much higher.

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