Crude settled up $1.56 at $70.23 on Thursday on the back of optimism that the economic recession was easing -- a prospect that could spell a recovery in ailing world energy demand. Natural gas futures also ended higher, backed by record heat in some of the regions in the U. S and a neutral weekly inventory report.

In a string of attacks in Nigeria, Africa's biggest oil producer, the Movement for the Emancipation of the Niger Delta (MEND), said it had sabotaged the Billie-Krakama pipeline in Rivers State, which supplies one of the country's main export terminals.

Exxon Mobil told environmental regulators in Texas that its huge Baytown refinery suffered an operational glitch that triggered flaring.

The U. S. Energy Information Administration report showed that there was an inventory buildup of 94 billion cubic feet in natural gas. While it was below the Reuters estimate of 99 bcf, it was above the 85 bcf gain last year and the five-year average rise for that week of 84 bcf.

We expect Crude oil to trade sideways to up as geopolitical tensions in Nigeria and weaker dollar are supportive for crude oil prices. Natural gas inventories showed less than expected built which may cause sharp upside in prices. We recommend buying natural gas for the day.