Oil up over $108 on stronger equities and U.S. data

Oil was up above $108 a barrel on Friday, as equity markets strengthened and U.S. retail sales painted an encouraging picture for demand in the world's biggest oil consumer

Brent crude futures for September were up 41 cents to $108.43 a barrel, after having earlier traded up over $1 to an intraday high of $109.16.
U.S. crude oil was up 89 cents to $86.61 a barrel after touching $86.83 immediately after the positive U.S. data.
July U.S. retail sales posted their biggest gain since March, tempering fears that the world's largest economy might be slipping back into recession.
European equity markets and U.S. stock futures rallied, and the positive sentiment helped lift oil. The markets are now eyeing the upcoming University of Michigan confidence index.
"There seems to be a little bit of confidence coming back in after the falls earlier in the week although it looks like there will still be a bit of volatility," said Simon Wardell, an oil analyst at IHS Global Insight.
"Some people were concerned about a possible double-dip recession but no one is suggesting we will see the sort of contraction in oil demand like that we saw in 2008 and 2009."
A ban on short-selling financial stocks in four European countries including France took effect on Friday, a co-ordinated attempt to restore confidence in a market hit by rumors and higher borrowing costs.
European equities were up 2.8 percent by 13:04 GMT helped by reassuring data from the European Central Bank about the use of its overnight loan facility by banks.
"Equity markets are up and that's dragging oil higher," said Michael Hewson, an analyst at CMC Markets. "They tend to move in lock-step on the basis of risk."
Hewson added that oil was trading at the top of its range and believes it will struggle to push through the week's highs.
Concerns about oil demand in OECD countries have weighed on markets this week following warnings from the International Energy Agency on Wednesday.
It said that a 3 percent GDP growth scenario for 2012 would halve the base case 2012 oil demand growth to only 600,000 barrels per day.
The oil markets have been pulled back and forth as the dollar has strengthened then waned today.
One trader said that intraday movements of $1 either way meant little in the current environment, and analysts and traders expect the above normal levels of market volatility to continue.
"I do not know what is around the corner," Dominick Chirichella of the Energy Management Institute said. "I am not alone in that thinking and it is one of the reasons why all of the risk markets have a time horizon of about 30 seconds and the reason why we have seen huge flips flops on a daily basis."