RTRS: Oil rises above $53 after 4 pct jump, eyes housing data
Oil rose above $53 a barrel on Monday, adding to gains of 4 percent chalked up in the previous session, as positive Chinese economic data fed further hopes the world economy is beginning to recover from a painful recession.
Oil prices had risen more than $2 on Friday to settle at a four-week high, buoyed by improved U.S. consumer confidence and a Reuters survey that showed OPEC oil supply fell in April for an eighth consecutive month as members increased compliance with its agreed output cuts.
U.S. crude futures for June delivery rose 30 cents to $53.50 a barrel by 0533 GMT. London Brent crude rose 41 cents to $53.26.
"Oil prices are boosted by stocks and a rising risk appetite, which have risen on signs that a global economic recovery is on its way," said Michelle Kwek, an analyst at Informa Global Markets in Singapore.
"The positive China PMI data is adding another 'green shoot' to the recovery picture."
Brokerage CLSA said its China Purchasing Managers' Index (PMI) rose to a nine-month high in April of 50.1 from 44.8 in March, providing fresh evidence of recovery in the world's third-largest economy.
The latest sign of recovery from China came as Asian stock markets cheered Friday's U.S. data that showed a rise in consumer confidence and suggested manufacturing conditions were gradually improving.
Analysts say traders will also be keeping a keen eye on U.S. construction spending and pending home sales data due later on Monday, which will give a clearer indication of whether the world's largest economy is on its road to recovery.
Results of the U.S. government's bank stress tests, which will be released to the banks on Tuesday and to the public on Thursday, will also be a key market concern.
"A negative report could potentially cause a substantial pullback in the equities and energy markets," said Ben Westmore, a commodities analyst at National Australia Bank.
The Wall Street Journal reported on its website on Friday that Citigroup may need to generate up to $10 billion in new capital to meet the requirements of the U.S. government's stress tests.
World stock markets have been surging for two months, a rally banked on the notion that the pace of U.S. economic contraction may be easing, presaging a possible recovery from the first synchronous global recession since World War Two.
Crude oil speculators on the New York Mercantile Exchange shifted to a net long position in the week to April 28, data from the U.S. Commodity Futures Trading Commission showed on Friday.
