Crude oil rebounds from 2-week low on economic outlook

DUBAI: Crude oil rebounded from a two-week low after a report showing improved investor confidence in Germany and a debt sale in Spain that exceeded targets countered concern that European credit may be downgraded.

Crude advanced as much as 0.9% after the ZEW Center for European Economic Research said German investor confidence improved for the first time in 10 months. Spain's sale of 12- and 18-month bills topped the Treasury's maximum target, and a report on Tuesday may show US retail sales rose last month.

Futures fell earlier after Moody's Investors Service said on Monday it will review all European Union states' credit ratings and the International Energy Agency cut its 2012 oil-demand forecast.

"We'll see a little bit of a bounce today because there's some relief over the economic data that's coming out," said Michael Hewson, a markets analyst at CMC Markets in London. "If retail sales in the US are better than expected we could see oil make a go for the upside."

Crude for January delivery on the New York Mercantile Exchange rose as much as 88 cents to $98.65 a barrel and was at $98.42 at 12:04 pm in London.