NEW YORK (AP) - Oil prices spiked more than $25 a barrel Monday
- the biggest one-day price jump ever - as anxiety over the
government's $700 billion bailout plan, a weak dollar and an
expiring crude contract ignited a dramatic rally.
Light, sweet crude for October delivery jumped as much as $25.45
to $130 a barrel on the New York Mercantile Exchange before falling
back to settle at $120.92, up $16.37. The contract expired at the
end of the day, adding to the volatility as traders rushed to cover
positions; the October price began accelerating sharply in the last
hour of regular trading, a common occurrence when a contract is
about to go off the board.
Still, the rally, which shattered crude's previous one-day price
jump of $10.75, set June 6, showed the intensity of emotion in the
The November contract, scheduled to become the front-month
contract at the end of Monday's session, was trading at $108.69, up
Crude has gained about $30 in a dramatic four-day rally that has
at least temporarily halted oil's steep two-month slide below $100.
At this rate, crude is within striking distance of its all-time
record of $147.27, reached in July.
In other trading, gold prices shot up more than $40 and other
safe-haven commodities also rallied, underscoring investors'
uncertainly about the direction of the economy and their fear of
more turmoil ahead.
"We're off to the races again," said Jim Ritterbusch,
president of energy consultancy Ritterbusch and Associates in
Galena, Ill. "There's a renewed scramble for commodities because
of a general weakness in the dollar."
The Nymex temporarily halted electronic crude oil trading after
prices breached the $10 daily trading limit. Trading resumed
seconds later after the daily limit was increased.
(Copyright 2008 by The Associated Press. All Rights Reserved.)