Crude oil rose to a new record last week as
the dollar fell against the euro, prompting investors to buy
commodities as a hedge against the currency's decline. The weakening
dollar and higher global demand for raw materials have led to records
this year for commodities including gold, corn, soybeans and rice.
Crude-oil prices touched a record Thursday, spurred by concern supplies
may not be adequate. The International Energy Agency said it may cut
long-term forecasts as fields deplete faster than expected. The price
decline at the end of the day occurred as some traders said this
month's 17% rally wasn't justified by U.S. stockpiles and demand.
Banks have increased their price forecasts
because of supply constraints and demand growth. OPEC ministers said
the group is powerless to stop the surge in prices. Members of the
Organization of Petroleum Exporting Countries, excluding Angola and
Ecuador, exported 22.762 million barrels a day on tankers in the four
weeks ended May 4. That compares with 23.786 million barrels a day in
the equivalent period to April 6, data.
Crude oil for July delivery rose to $132.19 a barrel.
The contract rose 4.9% last week. Futures reached $135.09 Thursday, the
highest since trading began in 1983. Prices have doubled over the past
year. Brent crude oil for July settlement rose to $131.57 a barrel. The
contract touched a record $135.14 Thursday. Crude oil may rise next
week, a Bloomberg News survey showed. This is the first time in 20
weeks that analysts forecast an increase in prices. There will be no floor trading in New York on May 26 because of the Memorial Day holiday.
Gold rose, capping the third
straight weekly gain, as surging energy costs boosted demand for a
hedge against inflation. Gold has gained 40% in the past 12 months as
oil doubled. The metal reached a record $1,033.90 an ounce on March 17.
Gold futures for June delivery rose to $925.80 an ounce. The metal
gained 2.9% last week after climbing 4.9% in the previous two weeks.
Silver futures for July delivery climbed to $18.29 an ounce. The price
gained 7.8% for the week, the most since late February. This year,
silver has advanced 23%, while gold climbed 10%.