Oil prices hovered above $58 a barrel in Asia on growing investor optimism that the worst US recession since World War II may have bottomed.
Benchmark crude for June delivery was down 23 cents to $58.27 a barrel midday in Singapore, in electronic trading on the New York Mercantile Exchange. The contract fell 13 cents yesterday to settle at $58.50.
Oil prices have jumped from below $35 a barrel in February amid signs the pace of economic deterioration has slowed, setting the scene for an eventual recovery.
"The feeling is we've seen the worst of it, and the only way now is up," said Gerard Rigby, an energy analyst with Fuel First Consulting in Sydney. "Some of this is also a trading momentum play."
Investors will be eyeing first-quarter earnings figures this week from retailers including Wal-Mart Stores Inc And Macy's Inc, while the government reports retail sales for April.
Consumer spending, which accounts for more than two-thirds of US economic activity, has been undermined by rising unemployment, which climbed to 8.9 per cent in April. There's still a lot of unemployment out there," Rigby said.
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