April 22 (Bloomberg) -- Crude oil rose to a record $119.90 a barrel in New York as the dollar dropped to an all-time low against the euro, prompting investors to purchase commodities as an inflation hedge.
The dollar touched $1.60 per euro for the first time after European Central Bank policy makers signaled they may raise interest rates because of inflation. Oil's 24 percent surge this year has pulled gasoline and diesel fuel to records, weighing on an economy already reeling from a credit crisis.
``This market defies gravity,'' said Tom Bentz, a broker at BNP Paribas in New York. The falling dollar ``provided us with the push we needed to make a new record.''
Crude oil for May delivery advanced $1.89, or 1.6 percent, to settle at $119.37 a barrel at 2:43 p.m. on the New York Mercantile Exchange, a record close. Futures reached $119.90 today, the highest intraday price since trading began in 1983. Prices are up 88 percent from a year ago.
The May contract expired today. The more-active June futures rose $1.12, or 1 percent, to settle at $118.07 a barrel.
Brent crude for June settlement gained $1.52, or 1.3 percent, to close at a record $115.95 a barrel on London's ICE Futures Europe exchange. The contract touched $116.75 today, an all-time intraday high.
``The euro is strong against the dollar, which is once again providing an impetus for a push higher,'' said Addison Armstrong, director of market research at TFS Energy LLC in Stamford, Connecticut. Crossing $1.60 per euro means ``there will be a lot of commodity buying, especially oil.''
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