Oil prices rose toward $57 a barrel today in Asia, extending gains to near six-month highs on investor expectations global economic growth may begin to rebound by the end of the year.
Benchmark crude for June delivery was up 27 cents to $56.61 a barrel by midday in Singapore, in electronic trading on the New York Mercantile Exchange. The contract yesterday rose 4.6 per cent, or $2.50, to settle at $56.34, the highest level since mid-November.
Oil has broken above a trading range of about $45 to $55 a barrel that it's been in since dropping from a record $147 in July, boosted by investor perceptions that the worst of a severe US recession may be over.
Governments across the world, led by the US and China, have announced massive fiscal stimulus packages that should eventually spark economic growth and demand for commodities, said Francisco Blanch, head of global commodity research at Bank of America Merrill Lynch.
"If we do reignite the global economy, the pressures will come back," Blanch said. "If we print enough money, we will get people to buy. If you give money to the world, the world will spend it".
The ADP National Employment Report, an unofficial gauge of the US labor market, said yesterday that private sector employment fell by 491,000 last month, less than the 708,000 jobs lost in March.
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