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Oil higher ahead of US energy data

Oil rose further in Asian trade on Wednesday with investors' mood lifted by expectations of improved demand and economic expansion in the US, the world's biggest energy user, analysts said.

business Updated: Oct 28, 2009 08:21 IST

Oil rose further in Asian trade on Wednesday with investors' mood lifted by expectations of improved demand and economic expansion in the US, the world's biggest energy user, analysts said.

New York's main contract, light sweet crude for December delivery advanced 16 cents to 79.71 dollars a barrel.

Brent North Sea crude for December delivery was eight cents stronger at 78 dollars.

Analysts expect US government data due later on Wednesday to show gasoline reserves fall by up to 1.2 million barrels in the past week while distillate stocks, which include heating oil, is seen declining by 1.1 million barrels.

They expect crude stocks to rise 1.8 million barrels.

On Thursday, the US will release economic data for the third quarter and analysts expect the world's biggest economy to have expanded in the July-September period after four negative quarters in a row.

"This growth will finally show up in the quarterly numbers this week with the release of the 3Q GDP report," analysts from Singapore's DBS bank said in a report. They tipped third quarter growth of 4.5 percent.

The market appeared to have ignored a decline in US consumer confidence, preferring instead to focus on Thursday's upcoming third quarter GDP data and weekly energy stockpiles report by the Department of Energy later Wednesday.

The Conference Board reported Tuesday its consumer confidence index declined for the second consecutive month, dropping in October to 47.7 from 53.4 in September. The index drop was much steeper than the 53.5 level expected by most analysts.

Crude prices hit 82 dollars last week, the highest since October 2008 partly on the back of a weak US currency which makes dollar-priced crude cheaper for holders of stronger foreign units.