* EIA reports surprise decline in U.S. crude stockpiles
* OPEC sees comfortable outlook for market fundamentals
* Euro zone Feb industrial output rose more than expected
(Updates prices, market activity, changes byline, previous
LONDON)
By Gene Ramos
NEW YORK, April 14 (Reuters) - Oil rallied more than 2
percent to above $86 a barrel on Wednesday as a surprise
drawdown in U.S. crude inventories and optimism about the
economic recovery sparked fresh buying, ending a five-day
losing streak.
The U.S. government's Energy Information Administration
reported crude oil stocks fell by 2.2 million barrels last
week, against forecasts for a 1.5-million-barrel build.
Gasoline stocks fell 1.1 million barrels, more than
expected, with weekly demand up nearly 3 percent, just after
the Easter holidays. []
The EIA's crude and gasoline data contradicted increases
reported by industry group American Petroleum Institute on
Tuesday, adding fuel to the day's price jump. []
"A decline in crude stocks and a bigger-than-expected drop
for gasoline stocks coupled with a weaker dollar and global
equity markets rallying puts a bullish backdrop firmly in
place, and a run to $90 and beyond is likely," said Chris
Jarvis, senior analyst at Caprock Risk Management.
U.S. crude <CLc1> gained $1.99 to $86.04 a barrel by 12:45
p.m. EDT (1445 GMT), within sight of an 18-month high above $87
reached last week. Brent <LCOc1> rose $1.56 to $86.28, trading
at a premium to the U.S. benchmark for a third straight day.
Oil was already up before the EIA report was released at
1430 GMT because of positive corporate earnings and upbeat
retail sales data for March -- fresh indications that the
economic recovery was taking hold that stoked risk appetite for
inventors.
European shares rose to their highest in more than 18
months, led by banks after JPMorgan Chase & Co <JPM.N> reported
a jump in earnings. Wall Street climbed for the fifth straight
day with the Standard & Poor's 500 Index <.SPX> topping 1,200
on stronger company results and retail sales. []
At the same time, euro zone industrial output rose more
than expected in February, data showed on Wednesday.
"It seems that the economies are improving around the
world, not only in the emerging markets," said Daniel
Briesemann, analyst at Commerzbank, adding that was
"definitely" supportive for oil and commodities.
The improvement in risk appetite weakened the dollar
against the euro and the yen. [] <.DXY>
The Organization of Petroleum Exporting Countries, in its
monthly report said economic optimism was driving prices and
that it saw a "very comfortable outlook" for oil's
fundamentals. The group also nudged up its forecast for 2010
oil demand growth. []
Support for oil prices could come from China's GDP data to
be published on Thursday, analysts said, while a potential
appreciation of the yuan would also boost values because it
would increase the country's purchasing power of
dollar-denominated commodities.
China's economy will grow faster in 2010 and 2011 than
previously forecast thanks to a better-than-expected global
recovery and strong investment momentum at home, a Reuters poll
showed. <POLL-CN>
(Additional reporting by Robert Gibbons in New York, Alex
Lawler in London, Alejandro Barbajosa in Singapore; Editing by
Bob Burgdorfer)
