Prices for crude oil increased by $2.86 to close at $109.09 a barrel on the NYMEX. That's the highest closing price since March 18.
May delivery for gasoline closely mirrored the crude oil price rise, rising by 2.68 cents a gallon, to close at $2.7835 in New York. The national average is now at an all-time high according to AAA, where they reported on their Web site that it now stands at $3.339 a gallon.
Futures for RBOB also broke an intraday record, as it went up to $2.7978. RBOB is the gasoline used to mix with ethanol.
The two major factors in the increase in prices were investors moving to commodities again, and the ongoing concerns about fuel inventory declines. It was estimated in a Bloomberg News survey that gasoline supplies dropped by 2.5 million barrels last week.
"We're seeing the funds jump in and buy commodities," said Phil Flynn, a senior trader at Alaron Trading Corp. in Chicago. "Commodities had by far the best returns during the last quarter. It would be risky to bet that either the stock market or dollar has hit a bottom yet."
Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts said, "There's little that's rational with the gains in the commodity markets now. I don't think we'll see oil prices fall until the economic slowdown is much more severe or inventories just become too high."
Commodity investment
In the first quarter alone, commodity investment has exploded to $400 billion, an increase of over 20 percent. Some think it'll pullback some, which could provide more investing opportunities.
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