Oil rose Friday in Asia following a whipsaw overnight session during which the expiration of options and a mix of news played havoc with prices trading in a range almost US$6 wide, AP reported. During Thursday's session, the front-month crude oil contract dropped as low as US$120.75 before bouncing back to finish above U$124 a barrel. Besides the expiration of options contracts, a temporary shutdown of ICE Futures trading in crude oil and other futures products due to a power outage also contributed to the previous session's volatility. Options let investors bet oil prices will rise or fall in the future, and prices can fluctuate widely on days when options expire. Light, sweet crude for June delivery rose 84 cents to US$124.96 a barrel in electronic trade on the New York Mercantile Exchange by midafternoon in Singapore. The contract finished 10 cents lower on Thursday at US$124.12 after rising as high as US$126.64 and falling as low as US$120.75. Oil initially climbed in the floor session as U.S. diesel fuel prices jumped 3.6 cents at the pump to a new national average of US$4.455 a gallon (U$1.178 a liter). Diesel is used to fuel most truck, trains and ships, and is a large part of the reason prices of food and consumer goods are rising so fast.
