Oil over 82 dollars after EU, IMF agree Irish bailout

Tuesday, 23 November 2010 00:46 - - {{hitsCtrl.values.hits}}

Singapore (AFP): Oil prices topped 82 dollars in Asian trade Monday as the euro’s value soared following the agreement of a massive bailout for financially strapped Ireland, analysts said.

New York’s main contract, light sweet crude for January delivery, gained 53 cents to 82.51 dollars per barrel.

Brent North Sea crude for January rose 53 cents to 84.87 dollars.

Oil prices followed the euro up as the European Union (EU) and International Monetary Fund (IMF) late Sunday agreed to bail out debt-ridden Ireland to the tune of between 80 and 90 billion euros.

A weaker US currency makes dollar-priced crude cheaper, stimulating demand and leading to higher prices.

“The EU and the IMF have agreed to a bailout plan for Ireland and that has strengthened the euro and as an end result, boosted oil prices,” said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.

The bailout -- the second emergency rescue within the eurozone this year -- was aimed at cleaning up Ireland’s devastated banking sector and is “warranted” to protect Europe’s wider economy, EU finance ministers said.

It comes several months after a 110-billion-euro EU-IMF rescue package for Greece.

In early Asian trade, the euro bought 1.3755 US dollars, up from 1.3673 dollars in New York late Friday.