Oil touched a high for this year above $74 a barrel on Friday ahead of further pointers on the economic health of the United States and as the dollar flagged against a stronger euro.
By 1305 GMT (9:05 a.m. EDT), the new front month U.S. crude futures contract for October delivery was up $1.15 at $74.06 a barrel, after briefly touching $74.48, its highest of the year. London Brent crude for October was up $1.10 at $74.43.
Oil is on track for a 7.3 percent gain this week, and was last at this level on October 21, 2008 when it closed at $75.22 a barrel on its way down from a record peak above $147.
We've seen a lot of short-covering in all commodities since the U.S. market opened...gold in particular. It has trickled back a little, but could move on fundamentals once the housing data is out, said Rob Montefusco, a trader at Sucden Financial.
Gold firmed 2 percent to a one-week high on Friday, intandem with a stronger euro, after robust euro area economic data dented the dollar's appeal and made bullion cheaper for non-U.S. investors.
The U.S. National Association of Realtors will also release existing home sales for July at 1400 GMT (10 a.m. EDT). Economists forecast a total of 5.00 million annualized units versus 4.89 million in June.
The market will scour Federal Reserve Chairman Ben Bernanke's speech before the Federal Reserve Bank of Kansas City Economic Symposium in Jackson Hole, Wyoming at 1400 GMT (10 a.m. EDT) on Friday for more clues on the health of the world's largest economy.
As yet, there were few signs of recovering U.S. fuel demand. Freight traffic across North America fell 17.9 percent in the week ended August 15 from the same 2008 week, a trade group said on Thursday in a weekly report.
Tighter regulation of the energy market may take the edge off high prices, Commerzbank said in note on Thursday.
The significant rise in the oil price in the first half of the year is due in large part to a recovery in investment by financial investors, analyst Eugen Weinberg at Commerzbank wrote in their Commodities Spotlight Energy newsletter.
If their influence is reduced by the (Commodity Futures Trading Commission's) actions and sanity prevails, the oil price will fall.
The CFTC is widely expected to introduce stricter position limits for non-physical investors in commodities before the end of 2009.
(Editing by James Jukwey)