U.S. crude oil futures recovered from sharp session losses and ended more than $1 higher on Thursday, shored up by a rebound on Wall Street and weakness in the dollar. NYMEX natural gas futures, pressured early by softer crude prices and concerns about record high storage and sagging demand, lost more ground Thursday morning after government inventory data showed a slightly larger-than-expected weekly storage build.

IN FOCUS:

The U.S. National Hurricane Center said Thursday Tropical Storm Danny was churning in the Atlantic south-southeast of Cape Hatteras, North Carolina, but forecast tracks show the system remaining to the east of the U.S. away from Gulf Coast oil and gas production.

The U.S. Energy Information Administration report showed that total domestic gas inventories climbed further into record high territory for this time of year, hitting 3.258 trillion cubic feet.

Temperatures in key gas consuming cities New York and Chicago were seen mostly below normal for the next six days, with highs sliding into the 60s-Fahrenheit, according to forecaster DTN Meteorlogix.

The spread between the current front month and the five-year forward crude contract ended at $13.91, edging down from $13.99 on Wednesday.

FUNDAMENTAL OUTLOOK:

Crude oil is expected to trade firm during the day. An upside in equities on the back of improving economic sentiment in the U.S and euro zone may provide some support to crude oil prices.