* U.S. crude ends Q1 up 5.54 pct for the quarter
* EIA report shows crude stocks up more than expected
(Recasts, updates prices, market activity)
By Robert Gibbons
NEW YORK, March 31 (Reuters) - Oil rose above $83 on
Wednesday, lifted to its highest close since October 2008 as
the euro's rise against the dollar offset U.S. government data
showing crude inventory rose more than expected and gasoline
stocks had a surprise build.
U.S. crude futures finished the first quarter of 2010 up
$4.40, or 5.54 percent, from the end of 2009. It was the fifth
consecutive quarterly gain for crude futures.
Front-month May crude futures on the New York Mercantile
Exchange <CLc1> rose $1.39, or 1.69 percent, to settle at
$83.76 a barrel, a third consecutive higher finish and the
highest close since crude ended at $83.76 on Oct. 9, 2008.
The intraday high of $83.85 closed in on the 2010 peak
price of $83.95 hit on Jan. 11, which also was the highest
intraday price since October 2008.
On Wednesday, Brent crude for May <LCOc1> rose $1.42 to
settle at $82.40 a barrel.
The dollar fell against the euro, though the greenback hit
a three-month high versus the yen. [] The dollar weakened
against a basket of currencies <.DXY> but was on track for its
best quarterly performance against the basket in 12 months.
Wednesday's U.S. Energy Information Administration oil
inventory report showed crude oil stocks rose by 2.9 million
barrels to 354.2 million barrels last week. The increase topped
the forecast for a rise of 2.4 million barrels, while gasoline
inventories logged a modest but surprise gain.
The EIA report also showed a much bigger increase in crude
stocks than the rise of 421,000 barrels reported a day earlier
by industry group the American Petroleum Institute.
"On the surface you would think this is a bearish report,
especially with gasoline showing an unexpected build," Mike
Zarembski, senior commodities analyst at Optionsxpress in
Chicago, said.
"But traders are focusing on the weakness in the U.S.
dollar today, which is keeping commodity prices in general
up."
The U.S. stock market ended lower as weak jobs and
manufacturing data offset strength in the energy sector. []
The U.S. shed 23,000 private-sector jobs in March, against
expectations for a rise, a report by ADP Employer Services
showed on Wednesday. []
Business activity in the U.S. Midwest expanded less than
expected in March. []
QUARTERLY GROWTH
U.S. oil demand has shown signs of recovery and China's
imports have increased, giving market bulls hope for sustained
growth by the world's top two oil consumers.
After the biggest annual rise in 36 years in 2009, most
commodities continued to rebound on general optimism that the
economy is recovering and demand will continue to improve.
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For a graphic on commodities Q1 performance, see:
http://graphics.thomsonreuters.com/310/CMD_Q1PRF0310.gif
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Oil prices this quarter traded from that $83.95 peak in
January to as low as $69.50 a barrel in February.
That sub-$15 range is more stable than the wide price
swings in the previous two years. Implied volatility for U.S.
crude is now at its lowest level since prices surged to a
record $147.27 a barrel on July 11, 2008, before plummeting to
$32.40 in December of that year.
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For a graphic of crude implied volatility, see:
http://graphics.thomsonreuters.com/gfx/RSW_20103103115220.jpg
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But Saudi Arabian Oil Minister Ali al-Naimi on Wednesday
told the International Energy Forum in Cancun, Mexico, that oil
market predictability was being harmed by demand uncertainty
and nontransparent financial markets. []
(Additional reporting by Gene Ramos and Edward McAllister in
New York; Chris Baldwin in London, Alejandro Barbajosa in
Singapore; Editing by David Gregorio)
