Oil prices jump higher as equities soar
Oil prices soared on Thursday after positive economic data in the United States sparked a rally in global stock markets, analysts said.
New York's main contract, light sweet crude for delivery in July, climbed 42 cents to 73.28 dollars a barrel.
London's Brent North Sea crude for July gained 43 cents to 74.18 dollars per barrel.
"It seems that the strong rally in the equity markets proved that risk appetite is back on the board and spread optimism in the energy market, helping crude oil prices to move higher," said Sucden analyst Myrto Sokou.
Asian and European stock markets rallied on Thursday, mirroring overnight gains on Wall Street, sweeping higher on enthusiasm over the brighter global economic outlook, dealers said.
The London stock market jumped 1.68 percent, Frankfurt gained 1.78 percent and Paris won 2.27 percent.
Asia markets also surged, with Hong Kong gaining 1.62 percent and Tokyo soaring by 3.24 percent.
Wall Street provided a strong cue as the Dow stormed 2.25 percent higher after the release of figures showing pending home sales rose for the third consecutive month in April.
Later Thursday, traders will digest the latest snapshot of energy inventories in the United States.
"Investors might remain cautious and wait for further clarification from the US economic figures today and the inventories report as there is still volatility and uncertainty in the markets," added Sokou.
"However, the energy market is back into positive territory and further positive signs from the US oil inventories report today could drive oil prices even higher towards 75-78 dollars per barrel."
Robust US home and auto sales reports boosted Wall Street and lifted oil prices on Wednesday.
Pending US home sales rose again in April while American car companies reported double-digit jumps in sales in May.
"The (oil) market is really tracking the stronger economic news coming out of the United States," said Jason Feer, vice president and general manager with energy market analysts Argus Media.
"Every time you get some good economic news from the US and some of the other major economies, oil has a tendency to follow it up on the assumption that a recovery in economic growth will lead to stronger demand for oil," he told AFP.
© 2010 AFP