NEW YORK (CNNMoney.com) -- Oil erased its losses and topped $79 a barrel Tuesday as traders purchased oil contracts after prices declined to their lowest level of the year earlier in the session.
What prices are doing: Oil for February delivery rose $1.02, or 1.31%, and settled at $79.02 a barrel, after falling to $76.76, the lowest level this year.
Crude prices fell more than 5% last week and settled at $78 a barrel on Friday as the cold snap ended across much of the country.
What's driving prices: Earlier in Tuesday's session oil prices fell to their lowest level of the year, pressured by a stronger dollar, which rose against the euro after a report showed German investor confidence fell more than expected.
Separately, Japan Airlines Corp. filed for bankruptcy Tuesday, fueling investor skepticism about the global economic recovery.
The Organization of Petroleum Exporting Countries also lowered its demand forecast on Monday and said it will leave production levels unchanged.
Later in the session, the low prices of oil attracted investors, who bought back the commodity and drove prices higher.
What analysts are saying: "I don't think this is the beginning of a rally, said Fitzpatrick, vice president of energy at MF Global.
He expects prices to remain between $67 and $72 through the first quarter of 2010 and rise thereafter.
"There's no real controvertible evidence that the economic recovery is underway," Fitzpatrick said. "We have hints but no overwhelming proof." 
| Overnight Avg Rate | Latest | Change | Last Week |
|---|---|---|---|
| 30 yr fixed | 3.80% | 3.88% | |
| 15 yr fixed | 3.20% | 3.23% | |
| 5/1 ARM | 3.84% | 3.88% | |
| 30 yr refi | 3.82% | 3.93% | |
| 15 yr refi | 3.20% | 3.23% |
Today's featured rates:
| Index | Last | Change | % Change |
|---|---|---|---|
| Dow | 32,627.97 | -234.33 | -0.71% |
| Nasdaq | 13,215.24 | 99.07 | 0.76% |
| S&P 500 | 3,913.10 | -2.36 | -0.06% |
| Treasuries | 1.73 | 0.00 | 0.12% |
| Company | Price | Change | % Change |
|---|---|---|---|
| Ford Motor Co | 8.29 | 0.05 | 0.61% |
| Advanced Micro Devic... | 54.59 | 0.70 | 1.30% |
| Cisco Systems Inc | 47.49 | -2.44 | -4.89% |
| General Electric Co | 13.00 | -0.16 | -1.22% |
| Kraft Heinz Co | 27.84 | -2.20 | -7.32% |
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