Oil prices rose above $73 a barrel on Friday amid lingering optimism that the recession is ending, spelling a rebound in ailing world energy demand.
U.S. crude for October rose 56 cents to $73.05 a barrel by 2:30 p.m. EDT. London Brent advanced 44 cents to $72.95 a barrel.
The strength extends Thursday's gain of $1.06 on the back of better-than-expected GDP and jobs data in the United States, the world's largest energy consumer.
Adding to the optimistic sentiment, data on Friday showed U.S. consumer spending rose in July and the U.K. economy shrank slightly less than expected in the second quarter.
The vast majority of economic data that continues to circulate around the media airwaves is positive and suggestive that the worst is definitely over and the recovery has likely begun in most economies around the world, said Dominick Chirichella, senior partner, Energy Management Institute, Point Pleasant, New Jersey.
Oil traders shrugged off a Reuters/University of Michigan survey Friday that showed that U.S. consumer confidence plumbing a four-month low in August and sapped early gains in equities markets on Wall Street.
Oil prices have moved dramatically this week between $70 and $75 a barrel without clear direction.
Crude futures are banging back and forth between support and resistance here. We saw a 10-month high at $75 earlier this week, but actually the supply situation is still unchanged, said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.
We have large supplies in the United States and globally and there has been no rebound yet in Asia, which is an important segment to world demand, he added. So until we see real signs of brighter economic prospects we will remain unable to break through the range, which I see at $67 to $75.
OPEC members meet in Vienna on September 9 to discuss output policy after a slew of cuts amounting to 4.2 million barrels per day since last autumn. Several members have indicated the producer group is unlikely to change policy.
(Reporting by Richard Valdmanis in New York, Chris Baldwin in London and Ramthan Hussain in Singapore; Editing by Christian Wiessner)