Crude Above $95.50 On China GDP, US data

The firm U.S. labor and housing market reports and China’s better-than-expected GDP data revived hopes of demand growth for oil, triggered positive sentiment and pushed crude near the highest in four months and towards the longest weekly winning streak in 14 months.

The world`s second-largest economy grew 7.9% in 2012’s fourth quarter beating forecasts of a 7.8%, confirming that recovery is on track, while China’s National Bureau of Statistics said that oil processing rose 3.7% last year to 467.9 million metric tons.

“These very strong headline numbers in November and December are probably a little ahead of where real demand is at the moment, but the overall picture for demand recovery is certainly in place”, said Sijin Cheng from Barclays, Singapore.

Recovery signs came from the United States as well, where the number of Americans filing new claims for unemployment aid hit a five-year low at 335,000 while residential construction surged in December to 954,000.

Crude is trading as of this writing around $95.55 a barrel compared with the opening at $95.17 and with the highest at $95.63 and the lowest at $95.11, but gains might be limited by some profit taking as prices are near the highest in four months.

“Fundamentally, the market is well balanced, but more positive economic data will push up the market… the U.S. contract rose above $95 for the first time since September, and that is triggering some profit-taking selling”, said Ken Hasegawa from Newedge, Japan.

Moreover, caution is rising ahead of a big earnings day in the U.S. and the lack of agreement on the U.S. debt ceiling. Meanwhile, UK will release its retail sales while the University of Michigan confidence report will be released from the U.S.

Brent is trading as of this writing around the $111.22 after rising 0.11%; natural gas is trading at $3.505 per 1,000 cubic feet after rising 0.31%; gasoline is trading at $2.7689 a gallon after rising 0.02%; heating oil is trading at 3.0298 after rising 0.28%.

Oil rose yesterday on reports that “foreign hostages died along with their captors as Algerian forces raided a natural gas plant operated by BP, Statoil and Sonatrach”, threatening supplies from North Africa’s largest oil and gas producer.