Nov. 25 (Bloomberg) -- Crude oil rose above $76 a barrel as the dollar weakened against higher-yielding currencies amid signs of a global economic recovery, bolstering the investment appeal of commodities.

Oil climbed as the U.S. currency slipped to a one-week low against the euro, encouraging investors to buy futures as a hedge against inflation. Asian shares also advanced on renewed optimism after Australia’s central bank said the country’s economy had entered a “new upswing.”

“It’s the weakening dollar,” said Ken Hasegawa, a commodity derivatives sales manager at Newedge in Tokyo. “Gold and the stock markets are extending their year highs so I believe the crude oil market will be steady.”

Crude for January delivery rose as much as 46 cents, or 0.6 percent, to $76.48 a barrel in electronic trading on the New York Mercantile Exchange. The contract was at $76.39 a barrel at 3:15 p.m. Singapore time. Yesterday, it fell $1.54, or 2 percent, to $76.02 a barrel, the lowest settlement since Oct. 14. Prices have gained 71 percent this year.

The dollar briefly weakened beyond $1.50 to the euro after a Japanese report showed the country’s exports dropped at the slowest pace in a year. Gold rallied to a record for the second time this week, reaching $1,179.70 an ounce.

With oil moving higher, “we can expect some short-covering before the long weekend,” Hasegawa said, referring to the U.S. Thanksgiving holiday. Floor trading at the Nymex is suspended tomorrow and the exchange will close early Nov. 27.

Oil Stockpiles

The U.S. Energy Department will probably post a 1.5 million-barrel increase in crude oil inventories in its Weekly Petroleum Status Report, due today at 10:30 a.m. in Washington, a Bloomberg News survey showed.

Analysts were split over whether stockpiles of distillate, a category that includes heating oil and diesel, rose or fell in the week to Nov. 20. Inventories were likely unchanged at 167.4 million, according to the median estimate from 17 analysts.

“I’m in the camp that we’re going to move sideways from here,” said Anthony Nunan, an assistant general manager for risk management at Mitsubishi Corp. in Tokyo. “Demand growth isn’t that strong, especially in the U.S. and we do have high inventories, so I think in the short term we could see high volatility.”

The American Petroleum Institute reported yesterday crude oil inventories increased 3.35 million barrels to 336.4 million last week. Gasoline stockpiles rose 1.71 million barrels to 212.2 million, while distillates fell 2.36 million to 166.9 million, the industry-funded group said.

Gasoline Demand

U.S. gasoline consumption dropped 1.4 percent, the first year-on-year decline in two months, according to a report yesterday by MasterCard Inc., the second-biggest credit card company.

Global oil stockpiles are too high and producers should be careful about increasing supply, Nigerian Petroleum Minister Rilwanu Lukman said yesterday. The African country was the eighth-biggest producer in the 12-member Organization of Petroleum Exporting Countries in October, based on a Bloomberg News survey.

OPEC is scheduled to meet Dec. 22 in Luanda, Angola, to discuss production policy. The group agreed at its Sept. 9 meeting in Vienna to maintain output quotas at 24.845 million barrels a day.

Brent crude oil for January delivery on the London-based ICE Futures Europe exchange rose as much as 63 cents, or 0.8 percent, to $77.09 barrel. The contract traded at $77.03 a barrel at 3:15 p.m. in Singapore. Yesterday, it fell $1, or 1.3 percent, to end the session at $76.46 a barrel.

To contact the reporters on this story: Yee Kai Pin in Singapore at kyee13@bloomberg.net; Ann Koh in Singapore at akoh15@bloomberg.net

Last Updated: November 25, 2009 02:32 EST