NEW YORK — Oil prices climbed on Monday as the dollar fell against the euro and other currencies. Benchmark crude rose 91 cents to $82.60 a barrel in midday trading on the New York Mercantile Exchange.
Gas pump prices were virtually unchanged from Sunday, at a national average of $2.813 for a gallon of regular. That’s about two cents below a week ago and almost 15 cents higher than a year ago. Drivers in western states, North Dakota and New York are paying the most, with pump prices above $3 a gallon. The lowest prices are found across most of the South, as well as Missouri and Oklahoma.
The dollar lost ground against the euro and fell to a 15-year low against the yen. That follows what JP Morgan analysts called a “rather bland” statement from the weekend G-20 meeting that said exchange rates should be determined by markets. “This is certainly nothing new, and the reality is currencies will continue to take a back seat to domestic priorities.”
Oil prices tend to rise as the dollar falls, because oil is priced in dollars and becomes more attractive to holders of foreign currencies.
The G-20’s lack of a firm position on currency devaluation makes it more likely that the Fed next month will announce more action to bolster the U.S. economy, possibly buying government securities, which will inject more money into the system. That’s likely to weaken the dollar further and support higher oil prices.
It’s not all about the dollar. Energy consultants MF Global said in a note to investors that “steady demand for raw materials from China and India are supporting oil. Additionally, industrial strikes in France, sparked by the government’s plan to raise the retirement age have shut 11 refineries cutting gasoline production.”
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