COLUMBUS, Ohio (AP) - Oil broke out of a weeklong slump Friday, soaring 13 percent, as traders prepared for a long Presidents Day weekend.
Light, sweet crude for March delivery rose $3.72, to $37.70 a barrel on the New York Mercantile Exchange. Prices rose as high as $38.25 in afternoon trading.
After opening above $42 a barrel Monday, crude prices have tumbled every day as traders showed little optimism that a $790 billion stimulus package and the Treasury Department's plan to spend more than $1 trillion to help remove banks' soured assets from their books would perk up the economy - and oil consumption - anytime soon.
Prices on Thursday closed at their lowest level of the year at $33.98 a barrel, and appeared headed back toward the January and February contract lows of $32.48 and $32.70 as oil inventories continue to soar during the worst recession since at least the 1980s.
The Energy Information Administration said Wednesday that crude inventories for the week ended Feb. 6 jumped 4.7 million barrels to 350.8 million barrels, surpassing analyst expectations and climbing toward levels last seen in the summer of 1990 when Iraq invaded Kuwait. U.S. oil storage sites, including the main depot in Cushing, Okla., are brimming with crude, reflecting the drop-off in demand.
"During the last week, we have had fresh estimates for oil demand which now forecast the biggest decline in consumption in more than a quarter of a century," Peter Beutel of Cameron Hanover said in his Friday report. "We have had a merciless unemployment report showing a decline in January of nearly 600,000 jobs, and we have had yet another increase in crude oil stocks, leaving inventories at their highest levels in 15 years, and creating the biggest surplus against the previous year since 1990. These factors have worked together to press crude prices right back against their spine of support."
Traders did not read much into Friday's jump in price, noting that markets will be closed because of the holiday Monday.
"I think people are taking some money off the table," oil analyst and trader Stephen Schork said.
Prices rose even as countries using the euro said the economy contracted by a record 1.5 percent in the fourth quarter and new car sales in Europe plummeted 27 percent in January from a year earlier to the lowest level in two decades.
Meanwhile, leaders of the world's major industrialized countries were meeting in Rome Friday to come up with ways to repair the global financial system.
The drop in output from third to fourth quarter was the biggest since the euro was created in 1999 and the third consecutive quarterly decline.
Analysts said the blame can be put squarely at the feet of waning trade volumes, hurt by slumping demand and a relatively strong euro that makes exports more expensive.
The European manufacturers' association ACEA said January auto sales figures announced Friday dropped below the million mark to 958,500 cars and said there were losses in all countries.
In the U.S., signs that consumers are cutting back spending on energy and just about everything else continue to arrive in financial reports.
Pepsico said its fourth-quarter profit fell, but the soft drink maker's adjusted results met analysts' expectations. Teen retailer Abercrombie & Fitch Co. said its fourth-quarter profit slid 68 percent due to hefty asset impairment and tax costs and dropping sales.
Prices at the pump edged to another new high for 2009, climbing 0.9 cents overnight to $1.961 a gallon, according to auto club AAA, Oil Price Information Service and Wright Express. Prices are 16.9 cents higher than a month ago, but remain a $1.018 lower than a year ago.
In other Nymex trading, gasoline futures fell 6.4 cents $1.1945 a gallon. Heating oil fell 2.12 cents to $1.30 a gallon, while natural gas for March delivery fell 7.4 cents to $4.411 per 1,000 cubic feet.
In London, the March Brent contract rose 28 cents to $44.93 on the ICE Futures exchange.
Associated Press writers Pan Pylas in London, Jake Neubacher in Vienna, Raf Casert in Brussels and Alex Kennedy in Singapore contributed to this report.