Oil rebounds on rally in gas and fuel prices

London: Oil rebounded from early lows to stand near $128 a barrel yesterday, as a rally in natural gas and refined oil products helped outweigh demand concerns and a firmer dollar.

US light, sweet crude oil futures rose $1.05 to $128.40 a barrel by 1527 GMT, off session lows of $125.22.

London Brent rose 69 cents to $128.47.

Traders said the recovery in crude was led by gas, heating oil and gasoline. Investors, especially speculators, with oversold positions were also coming back into the market, they said.

Nymex natural gas futures was nearly four per cent higher, while heating oil and gasoline were up nearly 1.5 per cent and 1.3 per cent higher.

Oil fell nearly $5 lower last week as investors booked profits after rallying to a record high above $135.