Oil hits 3-month high on strong China exports, Japan economic growth

Photo: The Canadian Press. All rights reserved.

A row of oil pumps work at sunset Sept. 11, 2013, in the desert oil fields of Sakhir, Bahrain. THE CANADIAN PRESS/AP, Hasan Jamali

Oil prices rose Monday as positive news on exports from China and economic growth in Japan followed last week's solid jobs report in the United States.

Benchmark West Texas Intermediate crude for July delivery gained $1.75 to close at US$104.41 a barrel on the New York Mercantile Exchange. That's the highest closing price since March 3.

Brent crude, a benchmark for international oils, rose $1.29 to US$109.15 a barrel in London.

China reported Sunday that exports rose seven per cent in dollar terms in May, up from a 0.9 per cent increase in April that followed slumps in February and March.

The surge in exports reinforced confidence that the U.S. and European recoveries will drive stronger demand for commodities, including oil.

Japan raised its estimate for economic growth in the January-March quarter to 6.7 per cent from 5.9 per cent, as investment by companies was stronger than first thought.

On Friday, U.S. employment figures also suggested stronger demand for oil. Employers added 217,000 jobs in May, the fourth straight month of decent growth.

In other energy futures trading on Nymex, wholesale gasoline gained five cents to US$2.98 a U.S. gallon (3.79 litres), heating oil rose two cents to US$2.89 a gallon and natural gas fell seven cents to US$4.65 per 1,000 cubic feet.

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