* U.S. crude up, analysts divided over demand destruction
* Jump in jobless claims weighs on dollar
* Market looks towards Chinese GDP, inflation data
(Updates prices, analyst comments)
By Nia Williams
LONDON, April 14 (Reuters) - U.S. crude rose on Thursday as
a fall in the dollar, a drop in U.S. gasoline stocks and
continuing conflict in OPEC member Libya overrode concerns that
high prices would lead to demand destruction.
A shock jump in U.S. initial jobless claims last week and a
lacklustre rise in March headline producer prices helped support
prices by reining in the dollar, which had earlier surged on
euro zone debt woes. [][]
Oil and dollar-denominated commodities often move inversely
to the dollar. A weaker dollar typically pushes up prices as it
reduces the value of greenbacks paid to producers while making
it cheaper for consumers that use other currencies.
U.S. crude rose 64 cents to $107.74 a barrel by 1345 GMT
after earlier dropping more than $1 to as low as $105.77.
Brent crude for May <LCOc1> was down 26 cents to $122.62
after briefly dipping by 98 cents to an intra-day low below
$122.
"The spike in jobless claims back over 400,000 hit the
dollar, which once again is supporting energy and precious metal
prices. It's a troubling data point from an area that we thought
some progress was being made," said John Kilduff, a partner at
Again Capital LLC in New York.
Prices also found support from U.S. gasoline stocks, which
plunged by 7 million barrels last week to their lowest level
since October as refiners cut processing rates and cleared
inventories of winter-grade fuel. []
The debate over whether high prices are crimping oil demand
has split market watchers, with some arguing it is premature to
suggest signs of destruction are visible and the that threshold
for price-driven demand reaction is higher than in 2008.
[]
This week the International Energy Agency and Organisation
of the Petroleum Exporting Countries both warned high prices
could dent demand but did not change their global demand
forecasts. []
"I believe we are in a price zone where we get an impact on
demand. Sustaining current prices is going to be difficult,"
Petromatrix analyst Olivier Jakob said. "Admittedly we still
have some geo-political risks, but some small exports are coming
back out of Libya."
Libyan rebels have said they are exporting a minimal amount
of crude from fields pumping around 100,000 barrels per day, far
less than usual production of 1.6 million bpd.
Analysts said supply is unlikely to rise significantly
unless a resolution to the conflict is reached. []
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More on Middle East unrest: [] []
Libya Graphics http://link.reuters.com/neg68r
Glencore IPO in graphics http://r.reuters.com/duj98r
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CHINESE INFLATION
In China, the world's second-largest oil consumer after the
United States, annual inflation was reported to have accelerated
faster than expected in March. []
The official first-quarter GDP figures and March consumer
price data will be released on Friday and closely scrutinised
for signs growth is out of control, which could prompt further
monetary tightening measures from the government.
"It (fiscal tightening) might be a bad thing for oil in the
short term, but in the long term if it means a soft landing for
the Chinese economy, it is a very good thing," said Christopher
Bellew, an oil trader at Bache Commodities. "We don't want the
over-heating to continue."
(Additional reporting by Florence Tan and Robert Gibbons,
editing by Jane Baird)
