SINGAPORE (Reuters) - Oil prices rallied above $71.50 a barrel on Wednesday, extending the previous session's dollar-driven 4.5 percent rally as investors waited for an OPEC meeting to conclude and fresh U.S. inventory data.
With OPEC widely expected to keep output targets unchanged, the focus remained on the dollar, which shed more than 1 percent on Tuesday to hit a one-year low of 77.05 against a basket of currencies.
"This is very much in a dollar-driven, inflation-driven, hysteria-driven market," MF Global commodity and energy analyst Edward Meir said.
"Oil looks terrible on the charts. OPEC will likely leave things unchanged and will end the meeting with exhortations to stick to quotas. There is potential weakness, yet we saw the biggest move in a month."
With gold also rising, serious inflationary pressures are getting ready to burst.
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