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Oil extends gains on US recovery hopes

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AFP PTI Singapore
Last Updated : Aug 03 2009 | 10:28 AM IST

Oil advanced further in Asian trade today, still cheered on by data showing the US economy contracted at a slower-than-expected pace in the second quarter, analysts said.

New York's main contract, light sweet crude for September delivery, rose 17 cents to $69.62 a barrel.

Brent North Sea crude for September delivery advanced 48 cents to $72.18.

Both contracts had closed higher Friday, buoyed by data from the Commerce Department that showed the US economy shrank at an annualised rate of 1.0 per cent in the three months to June.

That was less than the 1.5 per cent contraction that most analysts had expected, renewing hopes that the world's biggest economy was likely recovering from a recession that began in December 2007.

The United States is the world's number one energy user and any improvement in its economy is seen as a boost to oil demand which in turn lends support to crude futures prices.

Top US administration officials said yesterday that economic growth was highly likely to resume in the second half of the year and that President Barack Obama's massive 787-billion-dollar stimulus plan was working.

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First Published: Aug 03 2009 | 10:28 AM IST

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