Crude oil reversed its three day decline and began rising in the U.S. trading session lifted by a rebounding euro.
Until this morning’s European session, oil had been declining three days straight, marking the longest losing streak in a month, as investors concerns grew over slowing global economic due to Europe’s debt crisis.
Risk sentiment was high as speculation was mounting that Greece would default on its debt and Germany was preparing for such an event by discussing plans to shore up German banks to protect them.
However, as the single currency began advancing after bouncing off a six month low, since February 15th, cure oil followed suit and pared all losses as commodities became appealing again as an alternative investment to the U.S. dollar.
Oil for October delivery gained as much as $4 to hit $88.92 a barrel by 11:50 am New York time from an earlier low of $84.97.
“Crude’s simply reflecting views about where the economy is going,” commented Adam Sieminski , chief energy economist at Deutsche Bank AG in Washington. “On days when economic indicators are good, crude goes up, and on days when indicators are bad and people think Greece is going to default, it goes down.”