US crude oil prices hit the $78-a-barrel level on Wednesday ahead of the latest US weekly inventories data while base metals moved higher and gold held above $1,100 as commodity markets extended their recovery.
In energy markets, Nymex March West Texas Intermediate hit $78.04 before easing back to trade 52 cents higher at $77.76 a barrel.
ICE March Brent rose 64 cents to $76.70 a barrel.
US crude stocks were expected to have increased by 200,000 barrels last week, according to a poll of analysts.
An oil spill disrupted activity at Port Arthur in Texas which could have an impact on US crude imports.
Demand from US refineries was expected to remain weak with refinery utilisation seen unchanged at 78.5 per cent, close to a 20 year low – which excludes shutdowns caused by hurricanes.
Oil bulls will be hoping for some evidence of an improvement in demand for petrol and heating oil which has been disappointingly weak in recent weeks.
Distillate stocks (including heating oil) were expected to have fallen by 1.1m barrels.
Nymex March February heating oil added 1.6 cents, or 1.8 per cent, at $2.0473 a gallon.
Petrol stocks were forecast to have risen by 1.3m barrels. Nymex March RBOB unleaded gasoline added 2.6 cents, or 1.3 per cent, at $2.0435 a gallon.
Analysts at Citigroup reiterated their forecast for crude oil to trade at around $85 over the next six to 12 months but warned that high levels of inventories and seasonal demand weakness in the second quarter could put pressure on Opec to rein in excess supply.
“Since Opec oil ministers have expressed a reluctance to change policy as long as oil prices remain above $70, it might take a price break below that level to convince them of the need to improve compliance,” said Citigroup.
Gold traded at $1,117 a troy ounce after ending trading in New York on Tuesday at $1,114.80.
Among the base metals, copper rose 0.5 per cent to $6,888.50 a tonne while aluminium added 0.2 per cent at $2,133 a tonne .
