SINGAPORE (Commodity Online) : Global oil prices extended gains in Asian trade Friday mainly on encouraging reports of resurgence in global economy.
Light sweet crude for June delivery was seen trading at $85.61 a barrel at 11.30 a.m Singapore time while Brent crude was at $87.12 a barrel at the same time in London.
Analysts attributed black gold's recovery to optimism about the global economy that outweighed high inventories, Greece's fiscal troubles, Iceland's volcanic eruption and a lawsuit against Goldman Sachs.
Global markets staged a relief rally on Thursday as Greece moved to enact severe austerity measures to secure an aid package, easing fears that the debt crisis will spread across Europe. That boosted the euro and fueled the biggest jump in equities since early March.
Standard & Poor's this week lowered Greece's credit rating to junk status and also downgraded Portugal and Spain.
The US dollar grew weaker against other global currencies, making commodities such as oil, which is priced in US dollars, more attractive to overseas buyers.
On Thursday, Benchmark crude for June delivery rose $1.95 to settle at $85.17 per barrel on the New York Mercantile Exchange.
In London, Brent crude rose 74 US cents to settle at $86.90 a barrel on the ICE futures exchange.
Meanwhile, the US government declared the oil spill in the Gulf of Mexico a national disaster, as heavy onshore winds could blow the oil slick onto the Louisiana coast.
Fresh reports indicating the US economy was getting stronger boosted oil prices above $US85 a barrel on Thursday.