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Tuesday, September 22, 2009

Crude drops for third straight day

Firm dollar takes its toll on crude

Crude prices ended lower for third straight day at Nymex on Monday, 21 September, 2009. Prices fell following dollar's gains. Prices fell despite comments in the market that current recession was easing gradually.

On Monday, crude-oil futures for light sweet crude for October delivery closed at $69.71/barrel (lower by $2.33 or 3.2%). Last week, crude ended higher by 4%.

For the month of August, 2009, crude ended higher by a marginal 0.7%. For the second quarter, crude ended higher by 40%. Crude prices had rallied 11.3% in the first quarter of 2009.

Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 56.8% since then. Year to date, in 2009, crude prices are higher by 48.2%.

In the currency market on Monday, the dollar index, which measures the strength of dollar against a basket of other currencies, rose by 0.5%.

Federal Reserve starts its two day meet on monetary policy tomorrow. The FOMC will release on Wednesday a statement on monetary policy that may clarify how the central bank plans to unwind its quantitative easing programs.

Also on Monday, October reformulated gasoline gave up 8.1 cents, or 4.4%, to $1.7514 a gallon and October heating oil sank 7.62 cents, or 4.2%, to $1.7517 a gallon.

Also on Monday, October natural gas lost 20.2 cents, or 5.3%, to $3.576 per million British thermal units. Natural gas soared 28% last week, the biggest weekly gain in nearly three years.

Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

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