Oil prices rose to around $69 a barrel Thursday as the
U.S. dollar weakened slightly against the euro and the OECD
was optimistic about the recovery of the global economy.
    By midday in Europe, benchmark crude for October delivery
was up 95 cents to $69.00 a barrel in electronic trading on
the New York Mercantile Exchange.
    Oil prices gained as investors turned to commodities as a
hedge against inflation and dollar weakness. The euro was
trading at $1.4311, up from $1.4273 late Wednesday, while
the British pound was quoted at $1.6385, up from $1.6279.
    The Nymex contract settled unchanged at $68.05 on
Wednesday, when a report on U.S. crude inventory data shed
little light on demand.
    The U.S. Energy Department's Energy Information
Administration on Wednesday said crude inventories fell
372,000 barrels last week, while analysts had expected a
drop of 1.9 million barrels, according to a survey by
Platts, the energy information arm of McGraw-Hill Cos.
    However, gasoline inventories fell by 3 million barrels, a
steeper decline than analysts had expected.
    «There's a mix of good news and bad news,» said Clarence
Chu, a trader with market maker Hudson Capital Energy in
Singapore. «That's why the market will likely trade in a
range of $65 to $75 this month.»
    Trading volume was light Thursday ahead of the Labor Day
holiday weekend in the U.S., Chu said.
    The growth of Chinese crude consumption will likely help
push prices higher over the next year, a Morgan Stanley
report said.
    Chinese oil consumption has risen to 43 percent of U.S.
demand, up from 16 percent in 2000, while by 2024, China
will likely be the world's largest oil market, the report
said.
    Morgan Stanley expects oil to average $85 a barrel in
2010.
    Markets were also boosted by a new forecast from the
Paris-based OECD, which said that the world economy is
headed for an earlier recovery than previously forecast,
although the pace of the rebound will likely remain modest
for some time to come.
    The Paris-based Organization for Economic Cooperation and
Development also said that the economies of Japan and the
euro zone countries will contract by less than previously
forecast while the outlook for the U.S. is stable, while a
«gloomier outlook» was seen for Britain.
    In other Nymex trading, gasoline for October delivery rose
1.49 cents to $1.8235 a gallon and heating oil gained 1.86
cents to $1.7691 a gallon. Natural gas was up 1.3 cents to
$2.728 per 1,000 cubic feet.
    In London, Brent crude was up 67 cents at $68.33 on the
ICE Futures exchange.
    ___
    Associated Press writer Alex Kennedy in Singapore
contributed to this report.