AP

Singapore, Jun 11: Oil prices climbed above $72 a barrel on Thursday in Asia as investor optimism about a global economic recovery pushed crude to fresh highs for the year.

Benchmark crude for July delivery rose was up 80 cents at $72.13 by midday Singapore time in electronic trading on the New York Mercantile Exchange. On Wednesday, it rose $1.32 to settle at $71.33.

Oil has jumped from below $35 a barrel in March on expectations the worst of a severe US recession was over. Traders are now beginning to price in a recovery by the end of the year and improving crude demand, analysts said.

``Investors are expecting a quick turn around,'' said Ben Westmore, an energy analyst with National Australia Bank in Melbourne. ``If the data in the coming months shows there isn't a quick rebound, the oil price should fall.''

The Energy Department's Energy Information Administration said Wednesday that crude inventories fell 1.6 million barrels in the week ended June 5. Analysts had expected a build of 800,000 barrels.

Crude stocks have fallen four straight weeks, suggesting crude demand could be recovering.

``We might be seeing the early signs of a trend,'' Westmore said. Investors have also sought crude as a hedge against inflation on fears massive fiscal stimulus spending could weaken the US dollar. The euro gained to $1.4029 on Thursday from 1.3990 the previous day.

Iran and Kuwait, members of the Organization of Petroleum Exporting Countries, said on Wednesday the group may raise output if oil prices keep rising. OPEC slashed output 4.2 million barrels a day between September and January in a bid to bolster prices.

In other Nymex trading, gasoline for July delivery rose 1.01 cents to $2.03 a gallon and heating oil gained 1.15 cents to $1.82. Natural gas for July delivery was up 1.4 cents at $3.72 per 1,000 cubic feet.

In London, Brent prices gained 72 cents to $71.52 a barrel on the ICE Futures exchange.