Malaysian crude palm oil futures closed higher on Thursday fuelled by strong demand and higher crude oil prices. The benchmark third-month September contract on the Bursar Malaysia Derivatives ended up 11 ringgit at 1,498 ringgit ($409) a tonne.
It touched a high of 1,506 ringgit but failed to close above the key resistance level of 1,500 ringgit. Other contracts were up seven to 29 ringgits a tonne.
The overall volume stood at 8,450 lots of 25 tonnes each. "Crude oil prices are very high and overall demand from major buyers like China and Europe is very good," one dealer said.
Oil stayed within sight of a new record high beyond $75 on Thursday as investors fretted over gasoline supply in the United States, where drivers burn 40 percent of the world's motor fuel. Prices have climbed more than $5 a barrel over the past two weeks, fuelled by signs that US pump prices near $3 a gallon have yet to pinch the wallets of motorists in the world's biggest energy user.
Investment funds, a key driver of a four-year rally that began at $20, remain convinced there is no end in sight to the bull market and helped propel on Wednesday's climb to a new record of $75.40 a barrel.
Rising oil prices promise to further heat up producer and consumer interest in biodiesel, which Malaysia plans to sell at domestic pumps by October 2006 and also export?
From Europe to Asia, green fuel plants are going up at a dizzying pace as the world is told it cannot live without cheaper renewable energy from vegetable oils. In the physical palm oil market, traders were offering crude palm oil for July shipment at 1,435 to 1,437.50 ringgits a tonne, with bids seen at 1,432.50.
Trades were done at 1,425 to 1,440 ringgits a tonne.
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