Oil jumps to 2-week high

Crude futures pulled higher by a rally on Wall Street spurred by corporate earnings, housing data. Gasoline futures surge.

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NEW YORK (Reuters) -- Oil prices rose above $67 a barrel Thursday to their highest in more than two weeks, buoyed by worries about gasoline supplies and a rally on Wall Street driven by expectations for an economic recovery.

U.S. crude oil surged $1.76 to settle at $67.16 a barrel Thursday.

The gains were led by U.S. gasoline futures, which climbed 7.33 cents to $1.9116 a gallon amid slowing domestic refinery activity.

"Gasoline has become the item of choice because of the refinery run cuts. There is less of a supply surplus in gasoline than anywhere else in the complex," said Jim Ritterbusch, president of oil consultancy Ritterbusch & Associates.

The U.S. refining sector has been hit by a slew of unplanned outages, adding to deep run cuts enacted in reaction to weak profit margins and slumping U.S. demand for fuel under the weight of the recession.

Adding to oil's gains Thursday, Wall Street rallied on the back of strong corporate earnings that analysts said could portend an economic recovery.

Oil and other commodities have tracked equities markets in recent months as analysts seek signs of the economic outlook after the downturn cut world energy demand for the first time in a quarter century.

U.S. housing data added another glimmer of hope for an economic turnaround, with sales of existing homes rising in June -- the first time since 2004 that the measure rose three months in a row.

Meanwhile, the U.S. Labor Department released data showing first-time jobless benefit claims rose by around 30,000 to 554,000 for the week ended July 18.

Economists in a Reuters survey had forecast a total of 550,000 new filings, compared with 522,000 in the prior week.

Analysts at Barclays Capital wrote in a commodities research note that oil between $65 to $75 a barrel "would be the most comfortable range for prices within this quarter." To top of page

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