By Virginia Harrison, MarketWatch
SYDNEY(MarketWatch) — Benchmark crude-oil futures extended gains in electronic trading Wednesday, supported by a softer dollar, ahead of two U.S. inventory reports expected to reveal a drop in stocks for the fifth straight week.
Crude for August delivery CL1Q +0.78% rose 53 cents, or 0.6%, to $97.45 a barrel on the New York Mercantile Exchange during Asian trading hours.
Oil closed the North American session at a three-week high after a brokerage raised its price target for crude, and as some optimism about the U.S. economy encouraged buying.
The rise came ahead of two weekly inventory reports, with the American Petroleum Institute numbers due Wednesday, followed by the more closely watched report from the U.S. Energy Information Administration on Thursday.
Analysts polled by Platts expect crude-oil stocks will decline by 2.5 million barrels, while gasoline stocks are forecast to rise by 500,000 barrels, for the week ending July 1.
Gasoline stocks typically decline in the lead up to the July 4th holiday weekend and then begin to rebuild in July, according to Platts.
Traders were also awaiting June’s ADP employment figures and manufacturing data out of the U.S. Wednesday, ahead of non-farm payrolls Friday.
A falling greenback also helped spurred the advance in crude. The dollar index DXY -0.19% , which measures the greenback against six rival currencies, traded at 74.485, down from 74.670 in North American trade late Tuesday.
A weaker dollar tends to encourage investment in dollar-priced commodities such as crude.
Virginia Harrison is a MarketWatch reporter based in Sydney.
