Bullish sentiment, weak dollar push oil higher

Oil prices Thursday rose on bullish sentiment in the commodity and weakness in the US dollar, even as rising US oil production hit a new landmark.

US benchmark West Texas Intermediate for September delivery rose 10 cents to $105.49 a barrel on the New York Mercantile Exchange.

European benchmark Brent oil added 46 cents at $107.65 a barrel on the Intercontinental Exchange in London.

The oil market remains in a bullish mood, analysts said, in part due to a streak of recent withdrawals from US oil stockpiles. Some market observers also see continued unrest in Egypt as boosting the commodity.

"The crude market continues to exhibit incredible resilience," said Kyle Cooper, managing partner at IAF Advisors in Houston, Texas.

Cooper said some recent economic data has been weak, such as an HSBC's preliminary purchasing managers index of Chinese manufacturing activity that hit an 11-month low.

Investors are "latching on to whatever bullish is out there," Cooper said.

Oil prices have also gained ground because of recent weakness in the US dollar. Because oil is traded in dollars, the commodity becomes more affordable to buyers using stronger currencies.

Thursday's gains come despite the latest US report showing big increases in US petroleum output. Oil output reached 7.555 million barrels a day the week of July 19, the highest level since 1983, according to the US Energy Information Administration.

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