Oil tops $73 on equity rebound, U.S. demand

Crude oil prices rose above $73

on Thursday, supported by gains in Asian and European equity

markets and after the previous day's U.S. official oil data

showed an increase in fuel demand.

Market focus will shift later on Thursday to preliminary

first-quarter gross domestic product figures from the United

States, the world's largest economy and top energy consumer, for

signs of economic recovery.

By 1102 GMT, U.S. crude futures for July rose $1.83 to

$73.34 a barrel. ICE Brent crude futures gained $1.37 to $73.11.

On Wednesday U.S. crude jumped 4 percent, its biggest one

day percentage gain in over three months, after data from the

Energy Information Administration showed an increases in U.S.

demand for refined oil products such as gasoline and diesel.

"Today, U.S. demand does still play a part," Christopher

Bellew with Bache Commodities said. "Macro economic data is

absolutely the most important, also confidence in the recovery

is reflected in prices for equities."

U.S. crude rose to a premium to ICE Brent crude for the

first time since mid-April. It fell to a discount as deep as

$6.57 in mid-May due to a build-up in inventories at storage in

Cushing, Oklahoma.

Crude was also helped higher after Wednesday's data showed

inventories at Cushing, the physical delivery point of U.S.

crude, fell from record high levels.

Barclays Capital analyst Paul Horsnell noted the rise in

U.S. diesel demand in the weekly report. As diesel is used for

large trucks, its demand is often used as a gauge of the health

of economic activity.

U.S. GDP data for the first quarter will be released at 1230

GMT. Analysts in a Reuters poll forecast 3.4 percent growth.

Asian and European shares rose on Thursday mainly because

China denied a report it was reviewing its investments in euro

zone debt.