* EIA's surprise U.S. crude drawdown stems 10-week rise
* OPEC sees comfortable outlook for market fundamentals
* Euro zone industrial output, U.S. retail sales up
* Coming up: China GDP data due out on Thursday
By Gene Ramos
NEW YORK, April 14 (Reuters) - Oil prices rallied more than
2 percent on Wednesday as a surprise drawdown in U.S. crude
inventories and economic optimism sparked fresh buying and
ended a five-day losing streak.
U.S. crude <CLc1> gained $1.79, or 2.1 percent -- the
biggest percentage gain since March 29 -- to settle at $85.84 a
barrel. The day's high of $86.39 was within sight of an
18-month high above $87 reached last week.
Brent <LCOc1> rose $1.43, or 1.8 percent, to end at $86.15
a barrel, trading at a premium to the U.S. benchmark for a
third straight day.
The U.S. government's Energy Information Administration
reported that crude stockpiles 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. []
Both sets of data contradicted increases reported by
industry group American Petroleum Institute on Tuesday, adding
fuel to the day's price jump. []
"The petroleum complex was able to revive its bullish
footing with the help of a further strong advance in the equity
markets and an unexpected draw in crude supplies per the EIA,"
said Jim Ritterbusch, president of Ritterbusch & Associates in
Galena, Illinois.
"Furthermore, the economic optimism and increased risk
appetite that continues to spin off of the ever-rising stock
market is weighing on the dollar as its safe haven status is
curtailed," Ritterbusch added.
Oil prices were up early before the mid-morning EIA report,
roused by positive corporate earnings and upbeat retail sales
data for March -- fresh indications that the U.S. 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 U.S. dollar fell against the euro and the yen on
improved risk appetite. [] <.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 fundamentals.
The group also nudged up its forecast for 2010 oil demand
growth. []
Further 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 improve the country's ability to purchase
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>
In the U.S., investors will glean data on weekly jobless
benefit claims to gain further insight into how the labor
market is faring as the economy stages a gradual recovery.
(Additional reporting by Robert Gibbons in New York, Alex
Lawler in London, Alejandro Barbajosa in Singapore; editing by
Jim Marshall)
