Oil prices rallied this evening on increased signs of economic recovery in the US and Europe, which could eventually boost weak energy demand.
Brent North Sea crude was $1 higher at $73.89 a barrel, while US crude advanced 81 cents to $70.97.
Oil prices had risen on Wednesday after the US Federal Reserve said economic activity was 'levelling out'. Figures showing that Germany and France emerged from recession in the second quarter also helped lift prices.
This came despite latest data on US energy reserves, which showed that oil demand remained weak. The US Department of Energy yesterday that crude inventories rose by 2.5 million barrels to 352 million barrels in the week ended August 7, more than triple the amount expected by analysts. It was the third week running of higher crude stockpiles.
Also yesterday, the International Energy Agency gave a cool assessment of 'green shoots' of economic growth, saying that oil demand was lagging behind inconclusive signs of global recovery from the economic crisis.
