Oil Charges Higher Again

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Are oil traders believing that the Fed is saved the economy?

That’s the idea that’s being floated to explain today’s run up in the price of a barrel of oil. During the day, the price lifted above $52, but settled at $51.61.

That’s another three month high, and few people are anticipating a drop any time soon.

AP: Crude prices have increased 11.6 per cent since OPEC ministers met in Vienna on Sunday. The group said it would not cut production again immediately, but there is growing consensus that the millions of barrels taken off the market already each day are starting to balance a supply and demand picture that has been skewed for months.

With the April contract set to expire Friday, most of the trading had shifted to the contract for May delivery, where prices jumped $3.14 to settle at $52.04 a barrel.

Analysts rushed to buy crude after the Federal Reserve announced late Wednesday it would buy long-term government bonds, a measure that’s expected to jolt the U.S. economy with lower rates on mortgages and other consumer debt.

Photo: RichardMasoner

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