(Refiled to insert dropped word Agency in paragraph 10)
* Oil rises further after ending 4-day fall
* Germany and France report unexpected Q2 GDP rises
* U.S. Fed Reserve says U.S. economy has levelled out
* EIA weekly stocks show demand still weak
(Adds comments on retail sales, updates prices)
By Chris Baldwin
LONDON, Aug 13 (Reuters) - Oil rose back above $71 a barrel
on Thursday after positive economic news from the United States
and Europe's two largest economies, despite data showing U.S.
crude inventories rose much more than expected last week.
U.S. light crude for September delivery <CLc1> rose $1.61
cents to $71.77 a barrel by 1111 GMT, having ended a four-day
falling streak on Wednesday.
London Brent crude <LCOc1> gained $1.27 to $74.16.
Gross domestic product (GDP) in France and Germany, the euro
zone's two biggest economies, rose by 0.3 percent each in the
second quarter against expectations for a decline of 0.3
percent. []
The unexpectedly bullish news added to sentiment that the
worst of the deepest financial crisis in decades was over,
particularly after the U.S. Federal Reserve made its clearest
statement yet that it sees the recession nearing an end.
[]
This in turn pressured the dollar, as investors moved to
riskier assets, including commodities, after the Fed on
Wednesday held its benchmark rate near zero and said it would
likely keep it there for an extended period to guide the way to
recovery. [] []
"There's this global good feeling at the moment. It's
reverberating through everything, commodity markets equally as
well," said CMC Markets analyst James Hughes in London.
"Retail sales numbers could derail the markets later this
afternoon, but that's not likely because the economy doesn't
turn around on good feeling."
A Reuters survey of 74 economists this week said a jump in
new car sales fuelled by the "cash-for-clunkers" trade-in
program likely powered U.S. retail sales to a third straight
monthly gain in July. []
INVENTORY DATA
U.S. crude inventories rose much more than expected last
week on higher imports and lower demand from domestic refiners,
U.S. Energy Information Agency data showed on Wednesday. []
But forecasts that an oil demand recovery is at hand led
traders to shrug off the bearish weekly data from the world's
biggest consumer of energy.
Analysts at Barclays Capital forecast a bullish upswing in
global oil demand, seven times larger than the forecast from the
International Energy Agency, although they said there was
continuing upside risk.
"In the U.S., a swing up in industrial output, consumer
sales, final sales and a turn in the wholesale goods inventory
argue for an impending sharp change in the underlying dynamic of
U.S. oil demand," Barclays Capital said in its weekly oil data
review.
Potentially tightening supplies and adding support, reports
from the U.S. National Hurricane Center said the Atlantic could
get its first named storm of the year as a tropical depression
strengthens toward the U.S. Virgin Islands. []
Tropical storms and hurricanes can disrupt the operations of
offshore oil platforms and coastal refineries.
(Additional reporting by Maryelle Demongeot in Singapore,
editing by James Jukwey)
