Crude oil rose over $1 on Monday after the dollar dropped against the euro, and strained relations between the U.S. and Iran raised worries about crude supply.
Crude oil gained today after having fallen for four days as concerns of a possible recession in the U.S. grew.
Along with a rally in commodities, crude oil closed up $1.51 or 1.51 percent to $94.20 a barrel on the New York Mercantile Exchange. Brent crude settled at $92.66 a barrel, increasing $1.95 or 2.15 percent on London's ICE Futures Europe Exchange.
The dollar fell as low as $1.4915 against the euro, leading investors to boost gold futures to new records. Investors speculate that the Fed will lower interest rates this month.
Crude surged after President Bush warned that Iran is threatening global security by supporting militant groups. During his visit on Sunday to Abu Dhabi, Bush called Iran the world's leading state sponsor of terror, and warned Arab allies to confront the issue.
Iran is the second largest oil producing member of Organization of Petroleum Exporting Countries, a global organization whose members provide 40 percent of the world's total daily oil consumption. Any tension among the OPEC members raises worries about the world's oil supplies.
In addition, traders expect a boost in oil demand after the National Weather Service predicted low temperatures in the Northeastern part of the U.S. which is known as the biggest heating oil market in the world, noted Reuters.
Supports for crude prices came with effects from last week's attack in Nigeria where militant groups detonated a bomb on an oil tanker on Friday. A spokesman from Royal Dutch Shell, Europe's largest oil company, said on Monday the company halted exports of crude from one of its terminals in Nigeria starting from last Friday. The reason for the obstruction was reported as force majeure, an escape clause in contracts for events beyond a party's control.
Heating oil futures rose to $2.5758 a gallon. Gasoline prices rose more than 3 cents settling at $2.3509 a gallon. Natural gas futures rose $8.40 per 1,000 cubic feet.