* Falling dollar, Greek bailout hopes give boost
* Heating oil leads complex as US Northeast faces storm
* Iran tensions, Nigeria unrest offer support
(Recasts, updates prices, market activity to
settlement)
By Rebekah Kebede
NEW YORK, Feb 9 (Reuters) - Oil rose to settle more than 2
percent higher on Tuesday, buoyed by a weaker U.S. dollar,
gains on Wall Street, and a storm approaching the U.S.
Northeast.
U.S. crude prices for March delivery <CLc1> rose $1.86 to
settled at $73.75 a barrel, after hitting an intra-day high of
$74.15. At the end of last week, prices briefly dipped below
$70 a barrel to the lowest level since mid-December.
ICE Brent crude <LCOc1> settled at $72.13, up $2.02.
The U.S. dollar slipped from an 8-1/2 month high against
the euro on Tuesday after reports of an aid plan for the
struggling Greek economy. []
"The bottom line is that the dollar had been getting
stronger on concern over Greece, Portugal, Spain and now that
it looks like something is going to be done to take care of
those problems, the dollar sold off today and the stock market
rallied," said Peter Beutel, president, Cameron Hanover, New
Canaan, Connecticut.
Oil tends to rise when the dollar falls, making crude and
petroleum products cheaper for nondollar buyers. Weakness in
the dollar also encourages investors to move into more tangible
investments such as commodities
Although Germany denied reports that a decision had already
been made to extend an aid package to Greece, the S&P 500
remained up about 1.6 percent in by mid-afternoon and the Dow
was up 1.9 percent. []
Traders look to equity markets for signs of a broader
economic recovery which could revive flagging oil demand.
Heating oil futures led the oil complex gains on Tuesday as
snowy conditions in the U.S. Northeast, the world's top heating
oil consumer, was expected to boost demand for the fuel.
The snowstorm, the second to hit the U.S. East Coast in the
past week, shut U.S. government offices in Washington for the
second day on Tuesday.
Heating oil demand is expected to be 7.6 percent above
normal this week, the National Weather Service said on Monday.
[] []
"The cold weather and the uncertainty of whether people
will be able to make it to work lent a little bit of urgency to
some of the short-covering today," Cameron Hanover's Beutel
said.
IRAN SANCTIONS
Geopolitical tensions over Iran's nuclear program also
helped to underpin oil prices, analysts said.
The United States on Tuesday called for a U.N. sanctions
resolution on Iran within weeks after Iran announced that work
had begun to make higher-grade nuclear fuel. []
The Islamic Republic denies its program has military aims.
Sanctions against Iran could prompt the nation to retaliate
by reducing crude oil output or blocking exports traveling
through the Strait of Hormuz, through which some 40 percent of
the world's globally traded oil passes.
Continuing problems with militants in oil-producing Nigeria
also contributed to crude oil gains.
The market will later look to the release of the weekly
U.S. oil inventory data from the American Petroleum Institute
and the Energy Information Administration.
The API data due out at 4:30 p.m. EST (2130 GMT) may
provide clues about the pace of fuel demand recovery. The EIA
said Tuesday its weekly data, normally released on Wednesdays
at 10:30 a.m. EST, will be delayed until Friday due to the
snowstorm blanketing the U.S. capital.
U.S. crude oil inventories likely rose last week by 1.5
million barrels and distillates fell 1.9 million barrels, a
Reuters poll of 16 analysts showed Tuesday. []
(Additional reporting by Robert Gibbons and Gene Ramos in New
York, Emma Farge in London, Jennifer Tan in Singapore; Editing
by David Gregorio)
