Oil prices trading higher as optimism boosts Asia markets

US crude oil futures touched $77.66 a barrel in trading on Wednesday, the highest price since January 21st, and was trading up 22 cents at $77.45 at 0758 GMT, while on Tuesday oil prices soared over three percent, the biggest gain for a front month contract since September 30th, while in London ICE Brent crude for March rose 26 cents to $76.32 on the ICE Futures Exchange.

“We’ve had several months of indicators that suggest that economic expansion is under way, and this is likely to translate into higher oil demand for industrialized countries,” said Stefan Graber, a commodities analyst with Credit Suisse in Singapore.

Crude oil prices had slipped earlier after an industry report showed US crude inventories rose more than expected, damping optimism of a recovery in crude oil demand. “The US is still showing weak oil demand figures,” “If we see new disappointing numbers, we could see the price increase slow down,” Graber said, referring to government oil inventory and demand data to be published later on Wednesday.

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