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Oil prices rise on Alcoa results, China data

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(Globalpost/GlobalPost)

Global oil prices drifted higher Tuesday on the back of upbeat quarterly earnings from Alcoa and supportive inflation data from top energy consumer China, analysts said.

Brent North Sea crude for delivery in May won 24 cents to $104.90 per barrel in late afternoon deals in London.

New York's main contract, West Texas Intermediate (WTI) light sweet crude for May, added just nine cents to $93.45 a barrel.

The market had already rallied on Monday in a technical rebound after last week's sharp fall on poor US jobs data.

"Crude oil prices continued the upside momentum and extended gains on Tuesday, supported by better than expected earnings results from Alcoa and optimistic signs of growth revival as China's inflation in March was slower than initially estimated," said Sucden analyst Myrto Sokou.

"Brent oil has climbed above $105 per barrel area, while WTI crude oil has also extended gains toward $94 per barrel area."

Alcoa reported a 59-percent rise in year-over-year earnings, pointing to strong efficiency gains and a slightly tighter supply market.

Alcoa, the first major US company to report first quarter earnings, said profits came in at $149 million, up from $94 million in the same period last year.

In Asia, Beijing unveiled data showing inflation at 2.1 percent in March, well down from the 10-month-high of 3.2 percent seen the month before and below forecasts for 2.4 percent.

The news eased investor concerns that another high figure would prompt authorities to tighten monetary policy further.

"Evidently, some market players are beginning to view the lower price level following last week's marked price slide as a good opportunity to buy," noted Commerzbank analyst Carsten Fritsch.

"This is also suggested by the poorer than expected Chinese inflation figures.

"The inflation rate in China fell unexpectedly sharply to 2.1% in March, which opens up scope for stimulus measures if these are deemed necessary by the new political leadership in Beijing.

"Nonetheless, the potential for a major (oil) price recovery is limited."

Late last Friday, oil prices futures had dived after a poor non-farm payrolls report in the United States.

Brent tumbled to $103.62 per barrel -- which was the lowest point since late July 2012.

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http://www.globalpost.com/dispatch/news/afp/130409/oil-prices-rise-alcoa-results-china-data-0