Bloomberg Crude Oil Rises on Indications U.S. Fuel Demand Slump May End

March 26 (Bloomberg) -- Crude oil rose on signs that fuel demand in the U.S., the world’s largest energy consumer, may be coming out of a slump.

U.S. fuel consumption rose 2.2 percent to 19.2 million barrels a day last week, and gasoline demand gained 1.6 percent to 9.1 million barrels a day, according to the Energy Department. U.S. durable goods orders increased 3.4 percent last month, a Commerce Department report showed yesterday.

“Sentiment in the oil market has improved considerably in recent weeks, with the rise above $50 confirmation a bottom has been found,” said Carsten Fritsch, an analyst with Commerzbank AG in Frankfurt. “Durable goods data was better than expected, giving some hope about the future economy and a recovery of oil demand.”

Crude oil for May delivery gained as much as 97 cents, or 1.8 percent, to $53.74 a barrel on the New York Mercantile Exchange. It was at $53.66 a barrel at 11:41 a.m. London time.

Prices are up 20 percent this year on expectations that supply cuts by the Organization of Petroleum Exporting Countries would drain the crude glut created as the economic slump slashed demand. Monetary and fiscal policy to revive economic growth in the U.S. and other oil consumers may also add to demand.

Still, stockpiles in the U.S. continue to rise. Crude supplies rose 3.3 million barrels to 356.6 million last week, the Energy Department said yesterday. Inventories were forecast to increase by 1.1 million barrels, according to a Bloomberg News survey. Total daily fuel demand averaged over the past four weeks was 19.1 million barrels, down 3.2 percent from a year earlier. more...