Oil price climbs in response to Gustav threat
Posted
The price of oil is higher after forecasts that tropical storm Gustav will intensify into a hurricane.
West Texas crude has gained $1.23 to $US117.50 a barrel.
Oil was also boosted by a fall in fuel supplies in the US while strong economic data pushed US stocks higher.
Orders for durable manufactured goods jumped a surprising 1.3 per cent in July according to the Commerce Department.
The financial sector increased after troubled mortgage giants, Fannie Mae and Freddie Mac, raised more than $3 billion by selling short term notes.
Their shares rallied more than 11 per cent as the capital raising eased fears of a government bail-out of the companies.
Fannie Mae announced a management restructure and says executives, including its chief financial officer, have been replaced.
The Dow Jones Industrial Average gained nearly 90 points to 11,503.
The Nasdaq composite index rose 20 points to 2,382.
In Europe, comments by several European Central Bank officials, playing down the possibility of a cut in interest rates, saw the US dollar tumble against the euro.
In London, stocks were boosted by Wall Street.
The FT-100 increased 57 points to 5,528.
On the Sydney Futures Exchange, the Share Price Index 200 Contract for September is up 53 points to 5,038.
The 10-year bond contract is up by 0.3 to 94.34.
Yesterday, the All Ordinaries index increased slightly to 5,088 while the ASX 200 put on four points to 5,011.
The Australian dollar is slightly higher against the greenback.
About 7:00am AEST it was buying 85.85 US cents, 0.5830 euros, 94.09 Japanese yen, 46.78 pence Sterling and $NZ1.22.
Spot gold was at $826.70 US an ounce.
