Oil prices lift after Chinese stocks rebound

[NEW YORK] Oil prices rose on Thursday after a spate of losses, as a rebound in Chinese stocks somewhat eased concerns about financial turbulence in the world's biggest energy consumer.

US benchmark West Texas Intermediate for August delivery advanced US$1.13 to US$52.78 a barrel, after falling 13 per cent in five straight sessions.

Brent North Sea crude for August, the global benchmark, finished at US$58.61 a barrel, a gain of US$1.56 from Wednesday's settlement.

"It's a better day," said Bart Melek at TD Securities, pointing to a 5.8 per cent jump in the Shanghai Composite Index.

"There is hope that oil will continue to strengthen a little bit as China restores confidence," he added.

Chinese share prices have fallen 30 per cent since June, raising fears for the health of the world's second-largest economy.

The gains on Thursday came after the Chinese government's latest moves to calm the turmoil, including action to stop "major" shareholders - those holding at least a five percent stake - from selling their stocks.

Meanwhile, oil traders seemed hopeful that debt-riven Greece would strike a crucial bailout deal with European leaders this weekend.

"Petroleum prices are back on the upside... supported by the latest bout of optimism that Greece might reach a deal on its debt and a lack of clear progress on an Iranian nuclear agreement," said Tim Evans of Citi Futures.

An agreement with Iran would see the West lift punishing economic sanctions that have restricted the country's oil exports.

AFP