PORTLAND, Maine: Oil prices gained on Monday, briefly touching a 10-month high near $75 a barrel on expectations an economic recovery would revive ailing world energy demand.
US crude rose 48 cents to settle at $74.37 a barrel after peaking at $74.81, the highest intraday price since Oct. 21.
Brent crude gained 7 cents to $74.26.
The gains came alongside strength on Wall Street, where the stock market also briefly touched 10-month highs before pulling back slightly after a four-day rally.
Commodities markets have tracked stocks indexes closely in recent months as dealers view equities as a lead indicator of economic performance.
Oil dealers said many investors were also using commodities as a hedge against the dollar, particularly oil as OPEC producers work to restrain supply.
A report Monday showed implied oil demand in China, the world’s No. 2 energy consumer, rose in July for the fourth consecutive month as refiners ramped up activity.
Feeding hopes the recession was waning, reports on Monday showed new industrial orders in the euro zone rebounded in June and US economic activity improved again in July.
A string of positive economic data from various countries and rallying stock markets helped lift oil prices by 9.5 percent last week. Crude is up around 65 percent in 2009 and may head higher still, according to analysts.
Meanwhile, Iraqi Oil Minister Hussain Al-Shahristani said on Monday he saw “absolutely no need” for OPEC to decide to raise oil production at its upcoming meeting next month.
Al-Shahristani told Reuters in Istanbul that signs of global economic recovery would probably lead to increased oil demand in the near future, but at the same time crude reserves were higher now than they had been in the previous five years.
“We see absolutely no need for OPEC states to decide to raise production at the next meeting,” Al-Shahristani said on the sidelines of a meeting between Iraqi officials and executives from the oil industry.
“In order to have a balance between supply and demand, we in OPEC don’t want to drown the global market with crude that no one is buying.”
Al-Shahristani, who came to Turkey to showcase Iraq’s plans for a second round of oil contract tenders following a less-than-stellar first round in June, said oil production was still higher than global demand. The Organization of Petroleum Countries (OPEC) meets on Sept. 9.
Global stocks as measured by MSCI’s all-country world index rose 1.2 percent and was on track for a fifth straight session of gains.
The yen fell while the US dollar slid against commodity currencies, such as the Australian and New Zealand dollars, as investors became more comfortable with riskier trades given the upbeat assessment of the world economy.
About 1 p.m. (1300 GMT), the Dow Jones Industrial Average was up 15.34 points, or 0.16 percent, at 9,521.30. The Standard & Poor’s 500 Index was up 1.11 points, or 0.11 percent, at 1,027.24. The Nasdaq Composite Index was down 1.49 points, or 0.07 percent, at 2,019.41.
European shares hit their highest closing level in nearly 10 months, boosted by banks and miners.
The FTSEurofirst 300 index of top European shares ended 0.9 percent up at 975.19 points, the highest closing level since early November.
Japan’s Nikkei average jumped 3.4 percent, boosted by hopes for a global recovery and lifted by camera maker Canon Inc. and other exporters.
Spot gold was at $949.80 per ounce.
