Oil Prices Rise Sharply on Hints of Rebound

Oil prices rose sharply Thursday despite more hints that energy use is way down, with traders focusing instead on a rising stock market and surprising news from retailers that suggests Americans are spending money.

If registers at the mall are ringing, that likely means people are driving.

Benchmark crude for May delivery rose nearly 6 percent, or $2.86 to settle at $52.24 a barrel on the New York Mercantile Exchange. Trading was very light on a shortened trading week. Nymex is closed for Good Friday.

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In London, Brent prices jumped $2.47 to settle at $54.06 a barrel on the ICE Futures exchange.

"A lot of little things are giving investors hope that maybe the economy has seen the worst," said Andrew Lebow, senior vice president and broker at MF Global.

So far this week, home decor chain Bed Bath & Beyond Inc. and restaurant Ruby Tuesday Inc. have reported better-than-expected first quarter results. Teen retailer Hot Topic Inc. said sales at stores open at least a year rose more than analysts' forecasts.

On Thursday, Wal-Mart Stores Inc. said sales at stores open at least a year, excluding fuel, rose 1.4 percent, short of the 3.2 percent rise analysts were predicting. However, the world's largest retailer said a later Easter was to blame and that April sales are likely to be boosted by the holiday.

The government on Thursday said new jobless claims fell more than expected. The Labor Department's tally of initial jobless claims fell to a seasonally adjusted 654,000, down from a revised 674,000 the previous week. Analysts expected claims to drop only to 660,000.

"People are buying oil when they see signs of economic hope," said Phil Flynn, analyst at Alaron Trading Corp.

Flynn said he'll know that global demand has returned — and higher crude prices justified — when he sees both a significant drop in petroleum supplies and a decision by refineries to crank up their operations.

"Right now, we're not seeing that," Flynn said.