Oil trades near $60 a barrel in Asia

Oil prices were trading near $60 a barrel in Asia today, extending overnight gains on optimism over the global economy, analysts said.

A weaker dollar which made greenback-priced oil cheaper for buyers armed with stronger currencies helped boost prices, they said.

New York's main futures contract, light sweet crude for delivery in June, rose 68 cents to $59.53 a barrel.

The contract rocketed to a six-month high in intra-day trade on Tuesday, breaking through $60 a barrel to reach its highest level since mid-November.

Brent North Sea crude for June delivery climbed 76 cents to $58.70.  

"It's mainly technical now. It's kind of like a self-sustaining rally... Based on the belief that things are going to get better," said Tony Nunan, an energy risk manager at Mitsubishi Corp in Tokyo.  Better-than-expected US economic data has sparked hopes that the global economy will recover from its worst slump since the Great Depression relatively soon, which would mean a surge in demand for oil," other analysts said.  

But independent trader Ellis Eckland warned that higher oil prices could dampen an economic rebound.  

"If you start seeing oil prices in the high 60s (dollars) or the 70s, that's really going to put money out of consumers' pocket and hurt demand," he said.