Oil Prices Break $71 to 2009 High

New York, NY, June 10, 2009--The price of oil rose above $71 a barrel Wednesday to reach a 2009 high, as investors poured money into crude markets to protect themselves against the inflation risks posed by a weakening U.S. dollar.

Oil, which typically trades inversely to the dollar, has more than doubled in price in three months as traders also cheered news showing the worst of a severe U.S. recession is likely over. They brushed off data -- such as a 9.4 percent U.S. unemployment rate in May -- that suggest crude demand will remain weak. Even growing inventories have not checked crude's stellar rise.

Benchmark crude for July delivery was up $1.35 at $71.36 a barrel by noon in European electronic trading on the New York Mercantile Exchange. On Tuesday, it jumped $1.92 to close at $70.01.

The Energy Department's Energy Information Administration said Tuesday that crude prices will likely average $67 a barrel in the second half of 2009, about $16 higher than the first six months of the year. A month ago, the EIA's price-per-barrel forecast for the second half of 2009 was $55.

The Energy Department also said global consumption of oil, which has fallen by nearly 2 million barrels per day this year, will begin to rebound in 2010 as the economy recovers.