Oil rises on rosy economic data, Iran concerns

Singapore, Feb 24: Oil prices were higher in Asian trade Friday, supported by buoyant economic data from the United States and Germany as well as concerns over Iran's nuclear programme, analysts said.

New York's main contract, light sweet crude for delivery in April, rose 64 cents to $108.47, while Brent North Sea crude for April delivery gained 60 cents to $124.22 in morning trade.

"The level oil prices have risen to this week is quite unexpected," said Ken Hasegawa, energy desk manager at Newedge brokerage in Japan.

Positive economic news from the United States and Germany as well as "the continuing tension in Iran are factors supporting oil prices", he told AFP.

German business confidence unexpectedly rose to a seven-month high in February as robust domestic demand helped buffer the European Union's largest economy against the debt crisis, data from the Ifo economic institute showed.

Traders were also buoyed by US data showing initial jobless claims holding steady, a sign that the ailing labour market in the world's largest economy and biggest crude consumer was slowly improving.

Meanwhile, UN nuclear inspectors returned from Tehran on Wednesday with no progress in their search for answers from Iran on its alleged bid to develop nuclear weapons, leading Washington to brand the trip a "failure".

Iran has been hit by a raft of economic sanctions by the United States, United Nations and the European Union over its refusal to halt uranium enrichment activities.

Tehran insists that its nuclear programme is solely for peaceful civilian purposes.

"With the escalating tensions about Iran manifesting itself in a series of proxy wars, a messy end-game is becoming increasingly likely," said Barclays Capital in a commentary.

AFP