Oil prices shot up on Monday after U.S. data sent the dollar plunging, while reports of supply snags in the North Sea pushed up prices even further.
A weaker greenback tends to make oil a nicely priced asset in dollar-denominated exchanges, especially in the eyes of investors holding other currencies.
On the New York Mercantile Exchange, light sweet crude futures for delivery in July traded up 1.58% at USD93.43 a barrel on Monday, off from a session high of USD93.68 and up from an earlier session low of USD91.29.
A falling dollar made oil a nice buy on Monday.
The Institute for Supply Management said earlier its manufacturing purchasing managers’ index for the U.S. fell to 49.0 in May from 50.7 in April.
Analysts were expecting an unchanged reading.
On the index, a reading above 50.0 indicates industry expansion, below indicates contraction.
The numbers sent oil gaining on sentiments that the Federal Reserve will keep stimulus tools in place that keep the greenback weaker to spur recovery.
Meanwhile in Europe, better-than-expected PMI data further weakened the dollar and sent oil gaining.
The eurozone’s manufacturing PMI improved to 48.3 from 47.8 in April indicating that the slump in the manufacturing sector is easing, according to London-based Markit Economics.
Germany’s manufacturing PMI was revised up to 49.4 in May, beating market calls for a 49.0 reading.
Reports of supply snags in the North Sea sent Brent futures soaring.
Platform operator Nexen reported earlier equipment failure will cut output in the Buzzard oilfield until later this week.
On the ICE Futures Exchange, Brent oil futures for July delivery were up 1.73% at USD102.13 a barrel, up USD8.70 from its U.S. counterpart.