Oil prices rose more than a dollar to above $70 a barrel on Thursday after Nigeria's main militant group shut down one of Royal Dutch Shell's
U.S. crude futures for August rose $1.43 to $70.10 a barrel by 12:45 p.m. EDT. London Brent crude rose $1.59 to $69.92 a barrel.
In the latest in a string of attacks in Nigeria, Africa's biggest oil producer, the Movement for the Emancipation of the Niger Delta (MEND), said it had sabotaged the Billie-Krakama pipeline in Rivers State, which supplies one of the country's main export terminals.
Attacks by MEND have forced foreign oil companies, including U.S. oil major Chevron
Shell said it had shut down one of its pipeline junction points on Thursday but declined to say whether any oil production had been affected.
Nigeria's MEND rebels have escalated their activities recently and are certainly a supportive influence (to oil prices), Mike Fitzpatrick, vice president at MF Global in New York, said in a research note.
Oil prices also got a boost from a rebound in gasoline futures ahead of the July 4 holiday -- typically one of the busiest driving holidays of the year.
On Wednesday, U.S. government data showed stocks of gasoline in the world's largest energy consumer rose 3.9 million barrels last week, exceeding analysts' predictions. But inventories of the motor fuel remain roughly equal to where they were last year, providing little cushion if motorists hit the roads hard during the vacation season.
Stocks of distillates such as diesel and heating oil, meanwhile, have risen to 10-year highs due to the recession.
Crude prices have more than doubled since the lows near $30 a barrel plumbed last winter, on hopes for an economic recovery. A Reuters poll of industry analysts showed oil prices are expected to average more than $70 a barrel in 2010, compared with the latest forecast average of $56.59 for this year.
The U.S. economy shrank slightly less in early 2009 than previously thought, the government reported on Thursday, though there was widespread weakness in activity and demand was soft.
Gross domestic product dropped 5.5 percent in the first quarter, from 6.3 percent in the last quarter of 2008.
Separately, the Labor Department said the number of workers filing new claims for jobless benefits unexpectedly rose last week by 15,000 to a seasonally adjusted 627,000 -- a measure of the strain still faced by hard-pressed consumers.
(Additional reporting by Richard Valdmanis in New York and Ramthan Hussain in Singapore; Editing by Christian Wiessner)