* U.S. crude futures extend 2010 intraday peak to $85.22
* North Sea Brent crude oil jumps to over $84 barrel
* Investment inflows seen at start of new quarter
* Coming up: U.S. non-farm payrolls for March on Friday
(Updates prices)
By Gene Ramos
NEW YORK, April 1 (Reuters) - Oil rose for the fourth day
in a row on Thursday, closing at the highest level in 18
months, after upbeat U.S. economic data signaled better oil
demand ahead, prompting fund buying as the new quarter began.
A dip in the dollar against the euro and a basket of
currencies also sparked buying, traders said.
Ahead of the long holiday weekend and with the key March
U.S. jobs report due on Friday, traders also covered short
positions, helping push the market higher for the fourth
consecutive session, analysts said.
"This looks like a short-covering rally ... traders don't
want to go home with a lot of shorts, knowing the important
jobs data will be released on Friday, when the energy markets
are closed," said Richard Ilczyszyn, senior market strategist
at Lind-Waldock in Chicago.
Short positions are bets that prices will fall.
U.S. crude for May delivery <CLc1> settled up $1.11, or 1.3
percent, at $84.87 a barrel, the highest close since Oct. 9,
2008. It hit the day's high at $85.22, also the highest since
that day.
For the week, U.S. crude rose $4.87, or 6 percent.
London ICE Brent <LCOc1> closed up $1.31, or 1.6 percent,
at $84.01 a barrel, highest since Oct. 8, 2008. It posted the
day's high at $84.33.
Brent crude gained $4.72, or 6 percent, for the week.
The number of Americans filing new claims for jobless benefits
fell last week and factory activity in March hit its highest
level in more than 5-1/2 years, bolstering confidence of a
continued expansion in the economy. []
"Upward momentum is very strong," said Eugen Weinberg, head
of commodities research at Commerzbank in Frankfurt.
"Money is flowing into commodities at the beginning of the
new quarter from all sorts of investors, including funds," he
added.
The euro rallied against the dollar, lifted by quarterly
positioning as investors looked ahead to the U.S. non-farm
payrolls data on Friday. The dollar <.DXY> also fell against a
basket of currencies. []
Simmering geopolitical tensions amid talk of a possible new
round of sanctions against Iran, maybe within weeks rather than
months, could be underpinning the market, said Edward Meir at
brokers MF Global.
China on Thursday said it will join talks on imposing new
sanctions on Iran and President Hu Jintao's visit to Washington
this month could set the stage for tougher action on Tehran.
[]
JOBS FORECAST
Ahead of Friday's jobs data, the median projection from the
20 economists who have forecast payrolls most accurately over
the past year in Reuters' polls predicts 200,000 jobs were
created last month.
That is slightly higher than the 190,000 median forecast
from the broader sample of 82 analysts in the latest Reuters
poll. []
A rise would mark only the second time payrolls have risen
since the recession started in December 2007, although this
might be partly on the back of hiring for the 2010 census.
Oil markets have ignored Wednesday's government report of
the ninth consecutive weekly build in U.S. crude stocks, and a
surprise, if small, rise in gasoline supplies. []
U.S. government data showed U.S. crude inventories rose by
2.9 million barrels to 354.2 million barrels last week,
Gasoline stocks logged an unexpected 300,000-barrel gain.
"Many are looking at the fact that total implied refined
product demand is now in positive territory versus both last
year and the five year average for the same week," Dominick
Chirichella, senior partner, Energy Management Institute in New
York, said in a report.
(Additional reporting by Robert Gibbons in New York,
Christopher Johnson in London; Alejandro Barbajosa in
Singapore; Editing by Lisa Shumaker)
