Oil prices rally to above USD 69

Oil prices rebounded above USD 69 a barrel,clawing back ground after some recent heavy losses caused by caution over the strength of the global economic recovery.

Oil prices rebounded above USD 69 a barrel on Thursday,clawing back ground after some recent heavy losses caused by caution over the strength of the global economic recovery.

New York’s main contract,light sweet crude for October delivery jumped USD 1.05 to USD 69.10 a barrel. Brent North Sea crude for October delivery added 74 cents to USD 68.40 a barrel in London trade.

“There could be a little more (price) volatility with” US jobs data due on Friday,said VTB Capital analyst Andrey Kryuchenkov.

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“Otherwise,we are set to trade sideways near recent lows in the next few weeks before an expected rebound ahead of the fourth quarter.”

The final three months of 2009 are expected to see an increase in demand for heating fuel compared with the third quarter as winter hits the northern hemisphere.

Crude futures had fallen sharply from levels above USD 70 on Monday and extended losses on Tuesday before stabilising yesterday as official data showed US crude stocks had fallen by an expected 400,000 barrels last week.

The Department of Energy’s weekly report also said that gasoline stockpiles had dropped by three million barrels,far steeper than expected by analysts.

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The US is the world’s largest energy user and is seen as key to any recovery in oil demand. Crude prices briefly hit USD 75 last week,the highest level in 10 months.