Jan. 25 (Bloomberg) -- Crude oil rose for a second day in New York after U.S. lawmakers announced an economic stimulus package to avoid recession in the world's biggest energy- consuming country.

Oil prices this week have dropped as much as 5 percent in a day on fears of a potential U.S. economic slowdown and risen by 3 percent in a single trading session on government efforts to prevent a recession. Crude tracked gains in U.S. equities following the announcement by Congress and President George W. Bush. Gold and silver climbed and platinum jumped to a record yesterday because of the falling dollar.

``To the degree the market believes that a stimulus package will stave off recession, then sentiment improves in risky assets such as equities and commodities,'' said Dariusz Kowalczyk, chief investment strategist at CFC Seymour Ltd. in Hong Kong. ``Equities as well as energy and base metals are trading in tandem, being driven by perceptions of the near-term outlook for U.S. growth.''

Crude oil for March delivery rose as much as 51 cents, or 0.6 percent, to $89.92 a barrel in after-hours electronic trading on the New York Mercantile Exchange. It was at $89.89 at 1:49 p.m. in Singapore.

Yesterday the contract jumped $2.42, or 2.8 percent, to $89.41, the biggest one-day gain since Jan. 2, after closing the previous day at the lowest since Oct. 23. Futures reached a record $100.09 a barrel on Jan. 3. Prices are up 66 percent from a year ago.

Brent, Dollar

Brent crude for March settlement gained as much as 49 cents, or 0.6 percent, to $89.56 a barrel on London's ICE Futures Europe exchange, and traded at $89.54 at 1:50 p.m. Singapore time. The contract yesterday rose $2.45, or 2.8 percent, to close at $89.07 a barrel. Brent touched a record $98.50 Jan. 3.

Futures markets suggest the Federal Reserve will cut rates next week, prompting the dollar to fall against the euro. The U.S. currency has dropped more than 5 percent against the euro since the Fed lowered the overnight lending rate on Sept. 18.

``Oil is going to track up as the U.S. dollar weakens and stock markets stabilize,'' said Rowan Menzies, a commodity market analyst at Commodity Warrants Australia Pty in Sydney. ``The feeling in the stock market is that the Fed and White House are standing ready and won't let it all collapse.''

U.S. crude-oil inventories rose 2.3 million barrels to 289.4 million in the week ended Jan. 18, the Energy Department said in a report yesterday. Gasoline supplies increased 5.1 million barrels to 220.3 million barrels, the biggest gain since December 2006, the report showed.

Demand in terms of products supplied by refiners climbed 1.4 percent to 20.7 million barrels a day during the week of Jan. 18, the Energy Department report said.

The gain in demand came as refiners reduced their processing runs to 86.5 percent of capacity from 87.1 percent the previous week.

Refiners in the U.S., including Valero Energy Corp., the country's biggest, are reducing runs as high crude prices are cutting into profits. Tesoro Corp. also said it was lowering output.

To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net

Last Updated: January 25, 2008 00:54 EST