Oil closed up after a weak start on Tuesday, with Brent crude rising to a 2015 high of $63 a barrel as short-covering returned to a market depressed earlier by worries about euro zone stability. Threats to Middle East crude production and the falling US oil rig count seemed to spur market bulls despite global inventory data suggesting an oversupply of up to 2 million barrels per day, analysts and traders said.
"We're in this mode where the market continues to discount bearish news," said Dominick Chirichella, senior partner at the Energy Management Institute in New York. "Certainly there is some positive news out there about Libya and rest of the Middle East, but I don't see anything that's overly bullish."
Options in US crude oil futures were also set to expire Tuesday, another factor that could be supporting prices, said a New York broker. A similar upward move was observed a month ago when options expired in the previous front-month contract in US crude.
Brent oil's front-month contract for April delivery was $1.18 at $62.58 a barrel by 2:38 pm EST (1938 GMT), rebounding from a session low of $60.27. The session peak of $63 was the highest since December 18.
US crude futures for March settled up 75 cents at $52.53 a barrel, versus the intraday low of $50.81.
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