The dollar's reduction in value helped push up crude oil futures on Tuesday, Bloomberg reports.
Oil investing became more appealing to hedge against inflation while a U.S. Energy Department report on Wednesday is likely to indicate inventories slipped last week. The ongoing supply loss as a result of the continuing crisis in Libya prompted Goldman Sachs and Morgan Stanley to raise oil-price forecasts.
Memorial Day, which is coming up this weekend, represents the beginning of a heavy driving season as travelers hit the road for vacations.
"Oil fundamentals remain extremely constructive," Amrita Sen, an analyst at Barclays Capital in London, told Bloomberg. "Libyan supply is not going to come back to the market anytime soon. We should get a good Memorial Day driving season in the U.S."
At 8:40 a.m. on Tuesday, crude oil futures were up 1.59 percent, a $1.75 gain to $111.85 per barrel.
"It is only a matter of time until inventories and OPEC spare capacity will become effectively exhausted, requiring higher oil prices to restrain demand, keeping it in line with available supplies," according to a Tuesday note from Goldman Sachs analysts led by New York- based David Greely.
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