Oil bounced above $62 a barrel on Friday, buoyed by U.S. data suggesting the battered housing sector was beginning to stabilize and pointing to a gradual recovery from recession.
Oil was on track for a gain of more than 4 percent on the week, snapping four straight weeks of declines thanks to stronger equities markets, better corporate results and positive economic data, particularly from Asia.
U.S. crude oil for September delivery was up 60 cents at $62.62 a barrel by 1339 GMT (9:39 a.m. EDT). London Brent crude rose 60 cents to $64.35.
Oil prices slipped in early trade as the market consolidated after four days of gains and was undermined by a jump in the value of the dollar. Oil often moves inversely to the dollar as a rise in the U.S. currency makes oil more expensive to many consumers.
But the market then recovered on data showing new U.S. housing starts and permits jumped in June, propelled by a rise in ground-breaking for single-family homes and suggesting the battered housing sector was beginning to stabilize.
BOUNCE OFF LOWS
Looks like some initial profit taking after (a) good rally on the week. Certainly dollar strength was part of the early decline, said Tom Bentz, analyst at BNP Paribas Commodities Futures Inc.
Then June housing starts came in (at) 3.6 percent, better than expected, providing a bounce off lows, he said.
Bank of America
Some analysts had suggested Friday's corporate results might provide some upside surprises after strong figures earlier this week from Goldman Sachs
Economic data are sending mixed messages about the pace of recovery from recession.
Nouriel Roubini, one of the few economists who accurately predicted the magnitude of the financial crisis, said on Thursday the worst of the turmoil had passed, but said the United States would need a second fiscal stimulus, possibly by the end of this year, as the unemployment rate approaches 10 percent.
In China, refiners in the world's No.2 energy consumer boosted production by 6 percent in June to a record high after a rise in domestic motor fuel prices aided margins, although higher inventories and rising exports suggested domestic demand was lagging.
Oil prices are down nearly $10 since early July, partly reversing last quarter's 40 percent surge on concerns over energy demand, which has contracted for the first time in a quarter century under the weight of the recession.
(Additional reporting by Fayen Wong in Perth; editing by Michael Kahn)