NEW YORK (AP) -- Oil prices bounced back above $100 a barrel Thursday as a weakening dollar outweighed an unexpected jump in U.S. crude supplies, suggesting demand is weakening.
By early afternoon in Europe, benchmark oil for July delivery was up 14 cents to $100.43 a barrel in electronic trading on the New York Mercantile Exchange. Earlier in the session, it fell as low as $99.25, while on Wednesday the contract lost $2.41 to settle at $100.29.
In London, Brent crude for July delivery was up 47 cents to $115 a barrel on the ICE Futures exchange.
The euro strengthened to $1.4468 from $1.4374 in New York on Wednesday. The dollar slipped to 80.75 yen from 80.97 yen.
The weaker dollar -- which makes crude cheaper for investors with other currencies -- helped sustain prices despite rising U.S. stockpiles.
The American Petroleum Institute said late Wednesday that crude inventories rose 3.5 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted a drop of 1.9 million barrels.
Inventories of gasoline rose 1.5 million barrels last week while distillates fell 1.4 million barrels, the API said.
The Energy Department's Energy Information Administration reports its weekly supply data -- the market benchmark -- later Thursday.
Disappointing signals from the U.S. economy also helped push prices down. On Wednesday, payroll processor ADP said private employers created just 38,000 jobs in May, down from 177,000 in April. Meanwhile, the Institute for Supply Management said U.S. manufacturing had its sharpest monthly decline in growth in March since 1984.
"Markets were expecting weak manufacturing and jobs reports, given the softness elsewhere of late, but they got much worse," DBS Bank said in a report. "That's no longer serious growth territory, it's growth-barely territory."
MasterCard SpendingPulse also reported that retail gasoline demand in the U.S. fell for the 10th consecutive week.
"We still have a hard time seeing how commodity prices could move higher over the course of June given the fact that economic growth is now approaching 'stall speed,' particularly here in the U.S.," said Edward Meir from MF Global in New York.
In other Nymex trading in July contracts, heating oil was up 1.39 cents at $3.0226 a gallon and gasoline added 0.51 cent at $2.9824 a gallon. Natural gas futures rose 3.9 cents to $4.668 per 1,000 cubic feet.
Alex Kennedy in Singapore contributed to this report.