NEW YORK, N.Y. - Oil prices rose Monday as stock market gains encouraged investors to buy back into the crude market after heavy losses last week, when weak U.S. jobs figures dampened expectations.
Benchmark crude for September delivery rose 53 cents to US$81.23 a barrel in midday trading on the New York Mercantile Exchange. Oil has stayed above $80 a barrel for six straight sessions.
World stock markets mostly rose as investors waited to learn whether the U.S. Federal Reserve will announce further stimulus measures following a run of downbeat economic data.
Oil traders have been closely watching the stock markets to gauge consumer confidence in the economy, which Fed chairman Ben Bernanke recently characterized as "unusually uncertain."
Oil's fall on Friday was sparked by a U.S. Labour Department report that showed private employers hired 71,000 workers in July — way below the level needed to lower the unemployment rate, which remained stuck at 9.5 per cent.
That suggests U.S. demand for fuel will remain subdued as Americans keep a tight rein on personal spending.
Several experts continued to highlight the fact that oil prices seem currently influenced more by technical considerations rather than fundamental principles of global supply and demand.
"The oil price is currently more influenced by technical indicators than by the demand-supply situation," said a report from Commerzbank in Frankfurt, which also said crude could come under pressure if it fell below the "psychologically important" mark of US$80.
"From a fundamental view, this decline would be welcomed, because the oil market continues to be in strong oversupply at current prices."
In other Nymex trading in September contracts, heating oil rose 1.03 cents to $2.1575 a U.S. gallon (3.78 litres), gasoline gained 0.70 cent at $2.1200 a U.S. gallon (56.1 cents US a litre) and natural gas fell 13.9 cents to $4.328 per 1,000 cubic feet.
In London, Brent crude added 67 cents to US$80.83 a barrel on the ICE Futures exchange.
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Associated Press writer Pablo Gorondi in Budapest, Hungary, contributed to this report.
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