* Analysts, officials expect high oil price volatility
* U.S. crude, gasoline, distillates stockpiles rose -poll
* Coming Up: U.S. API inventory report; 2030 GMT
* For a technical view on oil prices, see: []
By Alejandro Barbajosa
SINGAPORE, May 11 (Reuters) - Oil climbed above $77 on
Tuesday, its second straight gain, on relief that a nearly $1
trillion emergency package to stabilise the eurozone would
allow the global economy to continue its path to recovery.
U.S. crude for delivery in June <CLc1> gained 27 cents to
$77.07 a barrel at 0300 GMT, up almost $3 from a 12-week low
hit on Friday, as the European debt crisis roiled financial
markets. ICE Brent for June <LCOc1> crude rose 23 cents to
$80.35.
The European Union over the weekend crafted the biggest
rescue package since the collapse of Lehman Brothers in 2008,
sending stock markets soaring around the world on Monday.
"It has brought a halt ot the freefall in confidence," said
Stefan Graber, a commodities analyst with Credit Suisse in
Singapore.
"Beyond the current turmoil, we have to monitor liquidity
in the oil market. Should we see stabilisation, and with the
real economy still recovering, then we think prices are going
to move higher" to between $80 and $90 in the third quarter,
Graber said.
On Monday, prices jumped as much as $3.40, before settling
up $1.69 at $76.80. Intra-day volatility will probably continue
in the coming days as participants gauge the full implications
of the package on markets, Graber said.
"Whether confidence is fully restored depends on the
uncertainties about the implementation of this program. I don't
think we are out of the woods just yet."
After last week's wild swings in the stock market, the
at-the-money implied volatility index for front-month crude
futures rose rose to 40.43, the highest since December 2009.
The eurozone package consists of 440 billion euros in
guarantees from euro area states, plus 60 billion euros in a
European stabilisation fund and another 250 billion euros from
the International Monetary Fund. []
The size of the aid package surprised market participants
and boosted confidence that oil demand growth will continue.
OPEC Secretary-General Abdullah al-Badri said he expected
the rescue package to boost oil prices back above $80 a barrel,
but warned of wild price swings as the global economy continued
on its path to recovery. []
Front-month U.S. oil futures on Monday ended back above the
200-day moving average of $76.47, after dropping below it
during last week's steep slide. Crude had most recently dipped
below that average in February during intraday trade.
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Attention in the oil market is set to turn to weekly U.S.
inventory statistics to be published over the next two days.
U.S. crude inventories likely rose by 1.6 million barrels
last week on higher imports and slightly lower refinery
utilisation, a preliminary Reuters poll of analysts showed on
Monday. []
Supplies of distillates including heating oil and diesel
probably added 1.2 million barrels, while gasoline stocks rose
700,000 barrels, the poll showed.
The industry group American Petroleum Institute will
release its inventory report for the week to May 7 on Tuesday
at 2030 GMT and the U.S. Energy Information Administration's
report is scheduled for 1430 GMT, on Wednesday.
(Reporting by Alejandro Barbajosa; Editing by Ramthan Hussain)
