* U.S. weekly jobless claims rise
* French unions extend strike
* EIA data awaited, API shows heating, diesel stock rise
(Updates prices)
By Ikuko Kurahone
LONDON, Feb 18 (Reuters) - Oil turned positive on Thursday,
rising towards $78 a barrel as the dollar weakened after an
unexpected increase in U.S. jobless claims, and on strikes in
French refineries.
U.S. crude oil futures <CLc1> rose 77 cents, or about 0.8
percent, to $78.10 a barrel by 1505 GMT, after falling to as low
as $76.32 earlier. Brent crude <LCOc1> gained 67 cents to $76.93
a barrel.
The dollar dipped against the yen and the euro as the number
of U.S. workers filing new applications for unemployment
insurance unexpectedly surged last week, a government report
showed on Thursday, dealing a setback to hopes the economy was
on the verge of job growth. []
The weak job market will continue to weigh on oil demand in
the Uniteed States, the world's largest oil consumer.
"The employment outlook is not showing a notable
improvement, and so you are losing a lot of gasoline demand that
would simply be associated with commuting to work," Harry
Tchilinguirian, BNP Paribas' oil analyst, said.
"A high level of unemployment also weighs on consumer
sentiment, so U.S. motorists will continue to limit
discretionary leisure travel."
The oil price fall was limited as the dollar dipped against
the yen after the jobless claims data. Earlier on Thursday, a
stronger dollar pushed oil lower by about $1.
A stronger U.S. dollar typically pressures oil prices as it
reduces the purchasing power of other currencies, discouraging
non-U.S. investor interest in dollar-denominated commodities.
Some traders cited the extension of French refineries
strikes, which may halt output from some plants, pulled up ICE
gas oil futures, leading other oil contracts higher.
[]
ICE gas oil was trading 1.43 percent higher, compared with
0.4 percent gain in New York heating oil and a 1.15 percent rise
in RBOB gasoline futures. <NEWOILOIL>
The market focus will shift to official oil figures.
Analysts in a Reuters poll expected the figures from the
Energy Information Administration (EIA) to show an increase of
2.2 million barrels in U.S. crude oil inventories in the week to
Feb. 12. []
They forecast an increase in gasoline inventories and a drop
in middle distillates stocks, including heating oil.
The figures will be released at 1600 GMT on Thursday, a
one-day delay from the normal Wednesday release due to a U.S.
public holiday.
(Additional reporting by Seng Li Peng in Singapore; Editing
by William Hardy)
