Crude Oil Soars To End At $69 A Barrel

(RTTNews) - U.S. crude oil surged to end sharply higher Monday on some bargain buying, rebounding from a 5-year low at its previous close after the OPEC decided not cut production, with the dollar trending lower and investors anticipating a cut in U.S. shale oil production.

The Organization of Petroleum Exporting Countries at its meeting in Vienna last Thursday, decided to maintain crude production at 30 million barrels a day, renewing fears of a huge supply glut.

Worries about demand growth persisted on the back of some soft economic data showing Chinese manufacturing activity in November to have slipped to an eight-month low, and activity in the U.S. manufacturing sector growing at a slightly slower rate in November, with the index of activity in the sector dropping less than anticipated.

Earlier today, Moody's Investors Service slashed Japan's credit rating by one notch to A1 from Aa3, with a stable outlook. The rating agency cited "heightened uncertainty over whether the government can attain its medium-term deficit reduction goal," and uncertainty about the timing and effectiveness of measures to boost economic growth as key drivers for the downgrade.

Light Sweet Crude Oil futures for January delivery, the most actively traded contract, surged $2.85 or 4.3 percent to close at $69.00 a barrel on the New York Mercantile Exchange Monday.

Crude prices for January delivery scaled a high of $68.98 a barrel intraday and a low of $63.72 - the lowest since July 2009.

On Friday, crude oil futures plummeted $7.54 or 10.23 percent to close at $66.15 a barrel, after the Organization of Petroleum Exporting Countries decided to maintain its production at 30 million barrels a day, renewing fears of huge supply glut.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 87.84 on Monday, down from its previous close of 88.22 late Friday in North American trade. The dollar scaled a high of 88.45 intraday and a low of 87.78.

The euro trended higher against the dollar at $1.2490 on Monday, as compared to its previous close of $1.2465 late Friday in North American trade. The euro scaled a high of $1.2506 intraday and a low of $1.2420.

In economic news from the U.S., a report from the Institute for Supply Management showed the index of manufacturing activity fell much less than anticipated in November, edging down to 58.7 from 59.0 in October. Economists expected the reading to drop to 57.8 in November.

From the eurozone, results of a survey by Markit showed eurozone manufacturing to have barely grown in November, hurt mostly by contractions in Germany, France and Italy. The final Eurozone Manufacturing Purchasing Managers' Index for November dropped to 50.1 from 50.6 in October, weaker than the flash estimate of 50.4.

Meanwhile, Germany's manufacturing activity declined in November, with production growth at its weakest pace in more than a year with new orders declining at the fastest pace in nearly two years. The Markit/BME German Manufacturing Purchasing Managers' Index declined to a 17-month low of 49.5 from October's 51.4.

From Asia, China's manufacturing purchasing managers' index slipped to an eight-month low of 50.3 in November, below expectations for a reading of 50.5 and down from 50.8 in October.

The China HSBC final manufacturing PMI hit a six-month low of 50.0 in November, unchanged from a preliminary estimate and down from 50.4 the previous month.