Tokyo - World oil prices extended gains in Asian trade on Wednesday as investors cheered the IMF's upbeat forecast for global growth this year, which is expected to boost demand.
New York's main contract, West Texas Intermediate (WTI) for March delivery, was up 38 cents to $95.35 in mid-morning trade, while Brent crude for March rose 33 cents to $107.06.
For the first time in nearly two years, the International Monetary Fund (IMF) raised its global growth forecast by a tenth point to 3.7 percent, after a 3.0 percent pace in 2013.
The optimistic outlook is fuelled by solid growth in the United States as other countries also move away from austerity budgets.
The International Energy Agency (IEA) also raised its prediction of global oil demand, which is dependent on the strength of the world economy.
Oil prices were “lifted by (the) IMF's upward revision of 2014 global growth and (after) the International Energy Agency upped its prediction of oil consumption growth in 2014,” analysts from United Overseas Bank said in a market commentary.
Stronger economic growth “denotes greater demand for crude oil because of expected higher economic activity”, added Tan Chee Tat, investment analyst at Philips Futures in Singapore.
Tan also said that the coming into operation on Wednesday of the southern leg of the Keystone XL pipeline in the United States helped bolster WTI prices.
“The pipeline is expected to be able to transport 700 000 barrels of crude oil per day,” Tan told AFP.
He said the pipeline would help further alleviate the supply glut at the Cushing port in Oklahoma as it eases the transport of crude oil to refineries in the US Gulf Coast to meet demand.