Oil higher in Asian trade

SINGAPORE: Oil rose in Asian trade on Monday, with investor mood upbeat that the global economy was over the worst of the slump, analysts said.

In particular, a stronger-than-expected set of US corporate earnings has fuelled hopes that the world's largest economy was on the mend from a recession that started late last year, they said.

New York's main contract, light sweet crude for September delivery, put on 39 cents to 68.44 dollars a barrel.

Brent North Sea crude for September delivery was 38 cents firmer at 70.70 dollars.

"People concluded that Asia seems to have turned the corner -- now the US is also thought to be recovering," said Tony Nunan, a Tokyo-based manager with Mitsubishi Corp's international petroleum business unit.

In Asia, a strong 7.9 percent surge in second quarter growth from China's economy has bolstered hopes that the region is also starting to shake off the US-led global slump.

After the United States, China is the number two energy user in the world.

Crude prices have surged about 10 dollars in New York over the past two weeks, energised by strong US corporate earnings and economic data suggesting the US and other key economies are starting to recover.

However, Phil Flynn of PFG Best Research cautioned that the rise in oil prices was not supported by economic fundamentals.

"Oil has ignored bearish supply and demand fundamentals as the fundamentals of expectations of an improving economy seem to be a bit more exciting," Flynn said.