Brent oil price trading over $78 on rising stock markets

Brent oil is trading over the $78 mark on Monday as prices get a lift from rising stock markets and investors get more optimistic that China’s growth will bolster oil demand.

In London, Brent crude oil futures for September 2010 delivery was trading at $78.40, 07.00 GMT on the ICE Futures Exchange.

“The market is aware of the fact that it’s going to be a pretty slow recovery in the US and in Europe, so although oil demand will grow over the next 12 months or so, it’s going to be a slow, gradual process.” said Ben Westmore, a commodities analyst at National Australia Bank.

“Oil prices have swung back to the top of the $75 to $80 range despite slowing economic growth headlines from China and the US, thanks to anticipation that more stimulus measures will materialise,” said Gordon Kwan, head of regional energy research at Mirae Asset Securities in Hong Kong.

Hedge fund managers and other large speculators increased their net long positions, or bets that oil prices will rise in the week ended July 27th, according to US Commodity Futures Trading Commission data.