Oil prices hit multi-month peaks on China data

Oil hit multi-month peaks on Thursday as investors tracked upbeat Chinese trade data, the weak dollar and the European Central Bank's decision to leave eurozone interest rates unchanged.

Brent North Sea crude for delivery in February rallied early on to $113.29 a barrel, reaching the highest level since October 18. It later stood at $112.37 in London late afternoon deals, up 61 cents from Wednesday's closing level.

New York's main contract, light sweet crude for February or West Texas Intermediate (WTI), jumped as high as $94.70 a barrel, reaching a level last seen on September 19. It later stood at $94.12, up $1.02 from Wednesday.

"Crude oil has rallied sharply today thanks to China's strong trade data and a weaker US dollar," said analyst Fawad Razaqzada at trading group GFT Global Markets.

He added: "The ECB's unanimous vote to keep interest rates on hold was also seen as positive for prices thanks to the rallying euro/dollar."

The European single currency jumped to a one-week high at $1.3217 after the ECB held record-low eurozone borrowing costs and its president Mario Draghi indicated that a further rate cut or stimulus measures were currently not on the cards.

A weaker greenback can make dollar-priced crude cheaper for buyers using rival currencies, in turn stimulating oil demand.

In Asia, official data showed that China's trade surplus soared 48.1 percent to $231.1 billion (176.4 billion euros) in 2012, though total trade volume grew at a much slower pace in the face of economic weakness at home and abroad.

The country's exports rose 7.9 percent to $2.05 trillion from the year before, while imports increased 4.3 percent to $1.82 trillion, the national customs bureau said.

China's trade volume, or the total of exports and imports, grew 6.2 percent in 2012, well below the government target of about 10 percent.

The data raised prospects that China, the world's second-biggest economy and biggest energy user, was gaining momentum again, analysts said.

"After losing altitude last year, Asia's economic engine, led by China, has fired up again," global banking giant HSBC said in a market commentary.

The trade figures are the latest in a string of data in recent months that indicate China has finally turned a corner after seven straight months of slowing growth, analysts said.

"We are seeing assets pick up across the board... after encouraging data with better-than-expected trade numbers from China," said Jason Hughes, the head of premium client management at IG Markets in Singapore.

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