Crude oil rose this morning after gains in Asian equities and growth in Japan's economy increased confidence that a global economic recovery will lead to higher fuel demand.
The MSCI Asia Pacific Index rose 0.5 per cent to 116.5 in Tokyo as banks reported higher profits. Japan, the world's third-biggest oil consuming country, yesterday reported 4.6 per cent growth in gross domestic product for the three months ended Dec. 31, surpassing the 3.5 per cent median estimate of economists surveyed.
"Japan had better-than-expected growth in the fourth quarter of 2009 and Japan is the second-biggest economy in the world and the third-biggest oil consumer," said Thina Saltvedt, a commodities analyst at Nordea Bank AB in Oslo. "That's given some support to the oil."
Crude oil for March delivery rose as much as $1.10, or 1.5 per cent, to $75.23 a barrel in electronic trading on the New York Mercantile Exchange today. It was trading at $74.91 a barrel at 8:44 a.m. London time.
The US was shut yesterday for Presidents' Day, while markets in China, Hong Kong, Singapore and Malaysia are closed for the Lunar New Year holiday. There was no floor trading in New York yesterday because of the US holiday.
Electronic trading ended at 1:15 p.m. in New York with no settlement of prices. Yesterday's electronic trades and today's session will count toward the settlement.
Brent crude for April delivery rose as much as $1.23, or 1.7 per cent, to $73.74 a barrel on the ICE Futures Europe exchange in London. It traded at $73.39 a barrel at 8:44 a.m. London time. The contract fell 39 cents, or 0.5 per cent, to settle at $72.51 a barrel yesterday.