Crude Oil Up As Equity Rises, Dollar Weakens

Crude oil edged up on Thursday as the rallying stocks and falling dollar outweighed another lower forecast for world energy demand and rising unemployment data.

Light, sweet crude for June delivery rose 60 cents to settle at58.62 U.S. dollars a barrel on the New York Mercantile Exchange.

Contract price dropped to as low as 56.55 dollars a barrel in the early trading as the market was concerned about the gloomy outlook of energy demand. The latest report from the U.S. Labor Department released Thursday showed an increase in the applications for the unemployment benefit. Both new and continuing jobless claims came out higher than analysts had expected.

Meanwhile, Paris-based International Energy Agency (IEA) cut its forecasts for the world oil demand for the ninth consecutive month on Thursday. IEA said it now expects global oil consumption to fall 2.6 million barrels, or 3 percent, in 2009. Both OPEC and the U.S. Energy Department also lowered their oil demand outlook for this year earlier this week.

But oil prices rose back to above 58 dollars, obtaining strength from the equity market which ended a three-day losing streak. A rising stock market also limited the dollar's appeal as a refuge, which sent the dollar down against euro and in turn pushed up commodities prices.

In London, Brent crude for June delivery fell 64 cents to 56.70dollars a barrel on the ICE Futures Exchange.