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SINGAPORE — Oil prices rose to near $100 a barrel Monday in Asia, bouncing back from last week’s plunge, as a weaker U.S. dollar made commodities less expensive for investors with other currencies. Benchmark crude for June delivery was up $2.36 to $99.54 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell $2.62 to settle at $97.18 on Friday. In London, Brent crude for June delivery was up $2.52 to $111.65 a barrel on the ICE Futures exchange. Oil prices fell 15 percent last week as the dollar strengthened and traders worried that slowing U.S. economic growth didn’t justify a 35 percent increase from February to near $115 on May 2. The euro rose to $1.4434 on Monday from $1.4312 on Friday while the dollar was little changed at 80.65 yen. Some analysts are taking heart from a larger-than-expected increase in U.S. jobs last month. Non-farm payrolls rose by 244,000 jobs in April, while the unemployment rate rose to 9.0 percent from 8.8 percent in March. “The fundamental backdrop in the market remains entirely unaltered, with global oil demand still showing continued strength,” Barclays Capital said in a report. “The general (oil price) trend from here should be higher, rather than lower.” Other analysts expect oil to drop as higher U.S. gasoline prices – up 37 percent from a year ago – undermine crude demand. U.S. gross domestic product growth slowed to 1.8 percent in the first quarter. “We expect oil to fall further as the global economy slows, the dollar continues to rebound, and the risk premium due to unrest in the Middle East eventually fades,” Capital Economics said in a report. In other Nymex trading in June contracts, heating oil rose 6.0 cents to $2.91 a gallon and gasoline added 7.0 cents to $3.16 a gallon. Natural gas futures were up 3.7 cents at $4.27 per 1,000 cubic feet.
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Weaker Dollar Sends Oil Prices Up
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Huffington Post…
(Reuters) – Starbucks Coffee Co (SBUX.O) Chief Executive Howard Schultz on Friday once again laid the blame for surging coffee prices at the feet of speculators, saying his chain had no problem getting beans. Arabica coffee futures have rallied over the past nine months to a 34-year high this month at $2.9665 per lb, basis second position. The market initially climbed on fund buying but was sustained by tight supplies of washed beans. Many analysts expect it will soon climb to $3 per lb. “Every supplier that I talk to, every producer, first thing I ask is, ‘Is there any problem with supply and demand?’” Schultz said. They tell him no, he said. Global stocks are at the lowest level since the International Coffee Organization began keeping records in 1965. The ICO has said stocks could fall lower. “I think it’s artificial. I think financial speculation has really stepped into the market,” Schultz said at the National Coffee Association meeting on Friday. Coffee consumers will not “respond positively” to higher coffee prices, Schultz added. “I think it’s a very hard dialogue with the consumer, face to face, as we have to as a retailer, when in fact there probably isn’t a substantive answer,” Schultz said. Starbucks is the biggest coffee shop chain in the world. Many roasters have been forced to pass along their increasing costs to consumers. Most recently, Kraft Foods (KFT.N) raised its list prices for most of its Maxwell House and Yuban roast coffees by 22 percent, its fourth and biggest increase in the past year. Rival J.M. Smucker Co (SJM.N) hiked its price for Folgers by 10 percent last month. (Editing by Walter Bagley) Copyright 2011 Thomson Reuters. Click for Restrictions .
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Starbucks CEO On Surging Coffee Prices: Blame Speculators
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