World oil prices rebounded strongly yesterday, winning support from soaring stock markets and a modest energy demand upgrade from the International Energy Agency.
New York's main contract, light sweet crude for delivery in August, jumped $1.94 to $76.89 a barrel.
London Brent North Sea crude for August soared $2.11 to $76.48.
Oil prices were "supported by a rebound in the global equity markets and amid expectations of a further drawdown in (US) crude oil inventories," said Sucden analyst Myrto Sokou.
"Market participants might focus on the US earnings results from Intel today and JP Morgan later this week for further signs of the global economic conditions that could affect oil demand levels in the near term," she added.
European equities rallied yesterday as investors shrugged off downbeat eurozone news to focus on hopes of improving US company results after better-than-expected earnings from aluminium giant Alcoa.
Wall Street also bounced higher yesterday after the positive start to the second-quarter earnings season boosted investor optimism about the economic recovery.
The Dow Jones Industrial Average of 30 blue-chip stocks was up 1.11 per cent at 10,329.26 points in early trades.
Alcoa booked a second quarter net profit of 136 million dollars compared with a loss of 454 million dollars a year ago. Investor attention is now on microchip giant Intel.
The US Department of Energy will meanwhile publish its weekly report on American oil stockpiles today. Elsewhere yesterday, traders digested the latest monthly report from the International Energy Agency (IEA), the energy strategy arm of the Organisation for Economic Cooperation and Development.
The IEA slightly raised its 2010 estimates for world oil demand, which it now sees 2.1 per cent higher at 86.5 million barrels a day.
However, next year, the group expects demand to slow in China and most other parts of the world.
"Markets in 2011 may prove 'not too hot, not too cold'," the IEA said in its key report. "Whisper it quietly, but we might, just might, be in for some market stability for a while longer."
The IEA added that it expects oil prices next year to average $79.40 per barrel.