Crude Oil Rebounds From One-Month Low as U.S. Dollar Weakens

By Rachel Graham and Christian Schmollinger

Nov. 13 (Bloomberg) -- Crude oil advanced as the dollar dropped, buoying demand for commodities as an alternative investment to the U.S. currency.

Oil rose from yesterday’s one-month low, reached after a government report showed rising stockpiles of crude and oil products. The U.S. dollar weakened to $1.4888 against the euro from a close of $1.4850 yesterday.

“We are seeing a bit of a rebound,” Hannes Loacker, an analyst at Raiffeisen Zentralbank Oesterreich, said by phone from Vienna. “The dollar is a bit weaker today.”

Oil for December delivery rose as much as 46 cents, or 0.6 percent, to $77.40 a barrel in electronic trading on the New York Mercantile Exchange and traded at $77.32 a barrel at 8:47 a.m. London time.

Oil fell as much as 3.5 percent yesterday to $76.52, the lowest intraday price since Oct. 15. Crude is up 73 percent so far this year.

The Energy Department report showed crude stockpiles rose a more-than-estimated 1.76 million barrels last week. Refinery operating rates fell to 79.9 percent of capacity, the lowest in more than a year. Gasoline inventories rose unexpectedly by 2.56 million barrels to 210.8 million, compared with a forecast decline of 350,000 barrels.

“There is a lot of uncertainty as to what we can expect with the rate of recovery in Western oil demand, particularly the U.S.,” said Toby Hassall, a research analyst at CWA Global Markets Pty in Sydney. “There are sectors of the economy that remain weak.”

Brent crude for December settlement added as much as 64 cents, or 0.8 percent, to $76.66 a barrel on the London-based ICE Futures Europe exchange and traded at $76.62 a barrel at 8:49 a.m. local time.

To contact the reporters on this story: Rachel Graham in London rgraham13@bloomberg.netChristian Schmollinger in Singapore at christian.s@bloomberg.net