Oil prices hold above 142 dollars ahead of US energy report

Oil prices breached 142 dollars per barrel again on Wednesday, nearing recent record heights, as traders awaited the latest weekly snapshot on energy stockpiles in the United States.

• New York’s main oil contract, light sweet crude for August delivery, jumped 1.06 dollars to 142.03 dollars a barrel in early European trade.
• Brent North Sea oil for August delivery climbed 1.34 dollars to 142.01 dollars a barrel.
• Prices rocketed to record highs on Monday on the back of tensions over oil producers Iran and Nigeria, and as the dollar remained weak against other major currencies, traders said.
• London Brent oil scored an all-time high of 143.91 dollars and New York crude enjoyed a life-time peak of 143.67.
• Concerns over geopolitical tension in the Middle East, the struggling US dollar and unrest in Nigeria continued to drive the market, dealers said.
• “They are talking about the usual stuff like the weak dollar, Iran and Nigeria,” said Clarence Chu, a trader with Hudson Capital Group, a New York-based energy trading house.
• “I would say people are still leaning towards the bullish side but they are looking for new news.”
• He added that the market would seek fresh direction from the US Department of Energy’s oil inventories report that was due for publication later Wednesday.
• The weekly US update is crucial for the market because the United States is the world’s biggest energy consuming nation, followed by number two China.
• A weak US currency, meanwhile, makes dollar-denominated raw materials like oil cheaper for buyers using stronger currencies, and therefore tends to stimulate demand.