Oil rises as dollar weakens

[Javaman]

http://news.yahoo.com/s/ap/oil_prices;_ylt=Ai.GxwdkvxRQJwE0TKcWsf2RP5Z4

NEW YORK – Oil rose on Thursday, as the dollar weakened and gas pump prices inched higher.

Benchmark West Texas Intermediate crude added 84 cents to settle at $112.29 per barrel on the New York Mercantile Exchange. In London, Brent crude rose 14 cents to settle at $123.99 per barrel.

At one point on Thursday the dollar dropped to a 16-month low against the euro. Since oil is priced in dollars, it becomes more attractive to buyers holding foreign currency as the dollar gets weaker. The dollar's been falling as investors remain convinced the Federal Reserve will keep interest rates near zero. Lower rates make the dollar less attractive.

Energy traders keep looking for signs that demand for oil and gas will increase as the global economic recovery continues. Analysts at Barclays Capital think they need not look far. "We continue to believe that the top for crude oil prices this year is not yet in," they wrote in a note to investors. "Oil demand indications remain very strong ... Chinese demand is still increasing at a rate faster than 1 million barrels per day."

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