* U.S. crude stocks down, gasoline up in July 4 week
* Distillates at 25-year high
* Weak U.S. dollar, strong equities support market
* Nigerian militants agree to 60-day ceasefire
(Recasts, updates prices and market activity to settlement)
By Rebekah Kebede
NEW YORK, July 15 (Reuters) - Oil prices settled over 3
percent higher on Wednesday, supported by falling U.S. crude
oil inventories, news of quarterly corporate results that were
better than expected and some signs of economic recovery.
U.S. crude settled at $61.54 a barrel, up $2.02 or 3.39
percent after reaching a high of $61.98 a barrel.
London Brent crude settled at $63.09 a barrel, up $2.23.
Crude stocks in the United States, the world's top oil
consumer, fell last week by a greater-than-expected 2.8 million
barrels to 344.5 million barrels, the U.S. Energy Information
Administration said. []
"The larger-than-expected crude stock draw of 2.8 million
barrels is attracting much attention so far in forcing values
to fresh highs for the day," said Jim Ritterbusch, president of
Ritterbusch & Associates in Galena, Illinois.
Oil prices also received support from gains in U.S. stocks,
which rose after news of better-than-expected results from
Intel Corp <INTC.O> and Goldman Sachs <GS.N>.
Equities were also supported by data showing U.S.
industrial output declined more slowly in June, while New York
state's factory survey was the strongest in more than a year.
The U.S. Federal Reserve said on Wednesday that the economy
may not contract as sharply as previously expected.
[]
The data boosted appetite for risk and spurred investors
out of the U.S. dollar and into equities and commodities. The
Reuters-Jefferies CRB Index of 19 commodities rose by about 1.5
percent by mid-afternoon.
The U.S. dollar fell to a one-month low against a basket of
six major currencies, while the euro rose 1 percent versus the
greenback. []
FUEL DEMAND SLUGGISH
Although upbeat quarterly results helped boost stock
markets and the energy complex on Wednesday, doubts lingered
about the strength of energy demand due to swelling stockpiles
of refined oil products.
The EIA data showed an increase in gasoline stockpiles in
the week to July 10, which included the July 4 Independence Day
holiday, when the summer driving season typically peaks.
Gasoline stocks climbed 1.5 million barrels to 214.6
million barrels, surpassing analysts' forecasts, despite the
Fourth of July holiday weekend.
"We should be focusing on gasoline, and gasoline
inventories increased going into the 4th of July holiday," said
Phil Flynn, an analyst at PFGBest Research in Chicago.
"Obviously, that raises questions about the demand side of
the equation, (and) evidence seems to be suggesting that it was
not very good," Flynn said.
Weak demand for fuel due to the ailing economy lifted
stockpiles of refined products, with distillate stocks reaching
a 25-year high last week, according to the EIA data.
Nigeria's main militant group agreed to a 60-day ceasefire,
but traders had yet to be convinced it would translate into a
more stable environment for oil production.
Doubts over the sustainability of any truce in Nigeria were
amplified after Henry Okah, a militant leader released by the
government on Monday, told Reuters he believed other militants
would keep attacking the country's oil industry.
(Additional reporting by Robert Gibbons in New York and Joe
Brock and Alex Lawler in London; Editing by David Gregorio)
