* U.S. crude inventories up more than expected last week
* Euro zone economic sentiment rises for a third month
* Weak U.S. GDP data tempers gains
(Updates with settlement prices)
By Gabriel Debenedetti
NEW YORK, Jan 30 Brent crude touched a
three-month high on Wednesday after better-than-expected
economic data out of Europe spurred optimism about the global
economy before oil pared gains with surprisingly weak U.S.
Sentiment drew further support from declines in U.S. refined
product stocks, although crude oil inventories rose sharply.
Brent crude futures settled 54 cents higher at
$114.90 a barrel after hitting $115.24, their highest since Oct.
16. U.S. crude oil settled up 37 cents at $97.94.
U.S. RBOB gasoline futures broke the $3.00 a gallon
mark for the first time since the end of September, settling up
over 2 percent at $3.0387.
The U.S. economy unexpectedly contracted in the fourth
quarter, suffering its first decline since the 2007-09 recession
as businesses scaled back on restocking and government spending
U.S. crude oil inventories jumped by 5.95 million barrels in
the week to Jan. 25, the U.S. government said. Analysts had
forecast a 2.6-million-barrel crude build.
But the recent run of economic optimism overshadowed the
inventory numbers and weak U.S. data.
"Overall, global macroeconomic trends such as the dollar and
global equity indices hitting new 52-week highs have been
pushing crude higher," said Chris Jarvis, president of Caprock
Risk Management in Boston.
Euro zone economic sentiment improved more than expected
across all sectors in January, rising for the third month in a
row in a sign that the region's economy could be emerging from a
low point in the fourth quarter of 2012.
Oil markets took the U.S. Federal Reserve's Wednesday
afternoon announcement it would maintain its monthly $85 billion
bond-buying stimulus plan in stride.
"For commodities, the Fed statement is definitely
supportive because they expect to continue asset purchases and
their accommodative policy for awhile," said Phil Flynn, analyst
at Price Futures Group in Chicago.
The short-term oil outlook was also buoyed by optimism that
growth is accelerating in China.
Factory activity in China is expected to have expanded at
its fastest pace in nine months in January, adding to signs that
recovery momentum is building as domestic demand strengthens.
Supply risks from the Middle East also supported oil prices.
Israeli forces attacked a convoy suspected to include a truck
carrying weapons on the Syria-Lebanon border on Wednesday,
sources told Reuters.
(Additional reporting by Robert Gibbons and Eileen Houlihan in
New York, Simon Falush in London, Jessica Jaganathan and Manash
Goswami in Singapore; Editing by Dale Hudson, Christopher
Johnson and Marguerita Choy)