Oil surged for a fifth day toward its 2009 high of $75 a barrel, boosted by a weak dollar and strong earnings from Intel that pushed U.S. stock futures sharply higher.
China's September trade data showed crude oil imports easing from peak levels in the last two months, and U.S. weekly oil inventory data from the American Petroleum Institute (API), will give the next clue on the pace of demand recovery in the world's top two energy consumers.
U.S. crude for November delivery gained 72 cents to $74.87 a barrel by 0220 GMT (10:20 p.m. EDT on Tuesday), after rising as high as $74.96 in electronic trading, a whisker away from the 2009 high of $75 hit on August 25. London Brent crude rose 61 cents to $73.01. There's a lot of positive sentiment right now, but that's largely driven by the softer dollar. There's not a lot of caution built into the market ahead of the release of the API numbers, which could surprise on the downside, given the warning signs of increasing product supply, said Mark Pervan, senior commodity strategist at ANZ Bank in Melbourne.
Whether the rally is sustainable depends on further dollar weakness. If there is, we could head toward the $75 to $80 range, but $75 would be a key resistance level, he added.
Tech bellwether Intel Corp's
Earnings are due from a number of major U.S. firms this week, and the oil market is tracking corporate results closely for signs of broad economic recovery.
Oil's gains on Tuesday came after the Organization of the Petroleum Exporting Countries said a recovering world economy is expected to boost world crude demand by 700,000 barrels per day next year, to almost 85 million barrels a day.
The dollar slid to a 14-month low against a basket of currencies as investors bet on higher yielding currencies and commodities over growing optimism about a global recovery.
Cold temperatures in the United States have also been price-supportive. The National Weather Service forecast the first seasonal wave of cold weather in the Northeast and Midwest would boost demand for heating oil to 43 percent above normal levels.
U.S. weekly oil inventory data from the American Petroleum Institute (API) will be delayed till later due to Monday's Columbus Day holiday, while the Energy Information Administration (EIA) report will be released on Thursday.
A Reuters poll of analysts forecast the data will show a 700,000-barrel build in crude stocks last week, after a surprise drawdown in last week's report. China's September trade data showed China's September crude oil imports totaled 17.2 million tonnes, up 14.4 percent from a year earlier, calculations based on customs figures showed on Wednesday.
(Editing by Michael Urquhart)