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Oil rises above $73 amid brighter economic outlook

Oil rises above $73 amid brighter economic outlook

Oil prices climbed above $73 a barrel Thursday, driven by strong Asian economic growth figures and market anticipation of positive data about U.S. growth prospects.
By early afternoon in Europe, benchmark crude for December delivery was up $1.81 to $73.32 a barrel in electronic trading on the New York Mercantile Exchange. The contract added $2.76 to settle at $71.51 on Wednesday.
Crude extended its gains from the previous day when the oil price posted its largest daily gain for eight months.
The rise came after the Organization for Economic Cooperation and Development raised its growth forecasts for euro-zone countries and others. Also, U.S. durable goods data were upbeat, and a number of analysts expect first-quarter U.S. gross domestic product will expand by more than initially thought.
The consensus in the markets is for GDP to have risen by an annualized rate of 3.5 percent, up from the provisional estimate of 3.2 percent.
"U.S. product demand has been looking increasingly brighter over the past weeks," said JBC Energy in Vienna.
Expected improvements in demand persuaded traders it was time to buy, Cameron Hanover said in a report but warned, "It could be a one or two-day event."
Prices had slumped from $87.15 a barrel earlier this month, dragged down by worries that Europe's debt crisis could undermine global economic recovery.
"Persistent fears about the (European) region's sovereign debt situation keep sentiment fragile and oil prices under pressure," Barclays Capital said in a report. "The risk to oil prices is clearly skewed to the upside, once this initial fear about the eurozone fades and fundamentals return to being the focus of the market."
First-quarter economic figures from China, Japan, Singapore, Taiwan and Malaysia raised hopes the region can offset any downturn in Europe.
Commerzbank analysts said there was "a temporary change of mood on the oil market (which) suggests that prices will rise further in the near term."
In other Nymex trading in June contracts, heating oil rose 3.66 cents to $1.9573 a gallon, and gasoline gained $2.76 to $1.9980 a gallon. Natural gas was up 1.5 cents at $4.194 per 1,000 cubic feet.
In London, the Brent crude July contact was up $1.81 to $73.32 on the ICE futures exchange.
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Associated Press writer Alex Kennedy in Singapore contributed to this report.
(bh)


Updated : 2021-04-18 04:01 GMT+08:00