Oil prices edged up Friday, on signs that the economy may lift demand for energy. Retail sales improved slightly in July and business inventories gained. But consumer sentiment fell to its lowest level in more than 30 years. The reports left traders in the same spot they were in when the week began - guessing about future demand potential for everything from gasoline to heating oil. Benchmark West Texas Intermediate crude rose 38 cents to $86.10 a barrel in midday trading on the New York Mercantile Exchange. In London, Brent crude rose 1 cent to $108.03 a barrel on the ICE Futures Exchange. Oil prices have bounced from a low of $79.30 to a little more than $86 a barrel this week as investors remain concerned about global economic growth, ongoing financial problems in Europe and signs of a slower economy in China, a huge importer of oil and other commodities. Traders recently have based their decisions buying and selling contracts largely on economic news and shifts in the stock markets. Good news means higher oil prices; discouraging economic news means prices have fallen. "The economic uncertainty is so great that basically any good news is a boost to commodities markets as well as stocks," said Michael Lynch, president of Strategic Energy & Economic Research. "People are just going to be watching the economic data and the stock market." The Commerce Department said consumers spent more on autos, furniture, clothing and gas in July, which sent retail sales up 0.5 percent. It was the best showing since March. The agency also revised sales higher in the previous two months. The monthly report is watched closely by investors because consumer spending accounts for about 70 percent of economic growth. The Commerce Department also said business inventories rose 0.3 percent in June. Total business sales rose 0.4 percent after a 0.1 percent drop in May. Meanwhile, the Reuters/University of Michigan survey of consumer sentiment fell to a 30-year low. Overall economic growth slowed to just 0.8 percent in the first six months of this year, the worst growth since the recession officially ended in June 2009. Lynch said he thinks oil prices will range between $85 per barrel and $90 per barrel in the next week, although he emphasized it is difficult to speculate because of the ongoing volatility in the market. Oil inventories may continue to decline, as they did last week, but Lynch isn't expecting demand to strengthen soon. Falling oil prices is providing some relief for motorists. The national average for gasoline fell 1.4 cents overnight to $3.606 a gallon, according to AAA, Wright Express and the Oil Price Information Service. That's 9.4 cents less than a week ago but still 83 cents more than a year ago. Motorists could see prices fall an additional 15 cents to 20 cents in the next week or so but much of that depends on how oil trades, Lynch said. In other Nymex trading, heating oil rose 1.25 cents to $2.9117 a gallon, gasoline gained 0.46 cent to finish at $2.8227 a gallon and natural gas futures dropped 2.7 cents to finish at $4.081 per 1,000 cubic feet.

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