SINGAPORE: Oil prices rose above $80 a barrel Tuesday in Asia, extending a two-week rally as better than expected US corporate earnings boosted investor confidence.
Benchmark crude for November delivery rose as much as 44 cents to $80.05 a barrel but later fell back and was up 20 cents at $79.81 by midday Singapore time in electronic trading on the New York Mercantile Exchange.
The contract rose $1.08 to settle at $79.61 on Monday.
Crude reached $80 for the first time this year after Apple Inc. and Texas Instruments Inc. reported third quarter earnings Monday that beat analyst forecasts. Caterpillar Inc., Coca-Cola Co. and DuPont are scheduled to report later Tuesday.
“Earnings have been fairly positive and everyone is looking for positives right now,” said Jonathan Kornafel, Asia director for market maker Hudson Capital Energy in Singapore.
Crude demand has remained sluggish this year as the global economy recovers from recession. With the US Federal Reserve keeping interest rates at near zero percent, investors have flocked to stocks and commodities to make money.
“This rally isn’t based on fundamentals. It’s about risk appetite,” Kornafel said. “Money is looking for some kind of return.”
In other Nymex trading, heating oil rose 0.62 cent to $2.03 a gallon. Gasoline for November delivery slipped 0.48 cent to $1.97 a gallon. Natural gas for November delivery jumped 6.2 cents to $4.84 per 1,000 cubic feet.
In London, Brent crude for December delivery rose 31 cents to $78.08 on the ICE Futures exchange.