Oil prices rally on renewed economic hopes

30 April 2009

Crude oil prices rallied to reach almost $51 (£34) on Wednesday, despite US data which showed that stockpiles of the fuel swelled by more than four million barrels.

The report by the Energy Information Administration revealed that inventories continued to rise over the past seven days, bringing supplies to a fresh 19-year high.

However, the oil market was buoyed by figures which showed a 4.7-million barrel draw in gasoline stocks, as well as a rise of nearly three per cent on the US stock markets.

This brought about renewed optimism that the recession could be easing and energy demand might begin to pick up in the coming weeks and months.

As a result, US crude for June delivery posted a gain of $1.05 to settle at $50.97 a barrel, while London Brent crude climbed 79 cents to reach $50.78 a barrel at the close of trading.

The gains come after home heating oil customers saw the price of crude fall for two consecutive days earlier this week on the back of fears that the global swine flu epidemic could hinder the economy and limit demand for jet fuel.

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