) -- Crude oil futures gained nearly $1 during Tuesday's session but once again failed to breach the $80 a barrel level.

The April delivery contract for crude added 98 cents, or 1.2%, to settle at $79.68 a barrel.

Darin Newsom, senior analyst at Telvent DTN, noted a pickup in commercial buying and seasonality factors as helping crude prices today. But he remains cautious, noting "we haven't been able to go through $83.95," or the price's high back in January.

For some, that lack of conviction continues to cast a shadow over the market.

"More interesting

than today's rise is we can't hold rallies above $80. Fundamentals aren't supporting it, and technicals aren't supporting it," said Mike Fitzpatrick, analyst at MF Global.

Inventory data released from the American Petroleum Institute after Tuesday's closing bell showed an increase of 2.67 million barrels in crude inventories for the week ended Feb. 26. The real read on fundamentals, however, will come Wednesday morning when the Energy Information Administration releases its own inventory report at 10:30 a.m. EST.

Analysts surveyed by Platts expect last week's crude inventories to reflect a 1.1 million-barrel build. Gasoline stocks probably rose by 160,000 barrels, while distillate levels are expected to fall by 975,000 barrels.

Fitzpatrick also said that a recent mix of data has left him uncertain about overall improvement in the economy. On Monday alone, separate reports showed an uptick in January consumer spending, though the manufacturing sector expanded at a slower-than-expected pace. Also due Friday, market observers are eagerly anticipating the government's latest labor market report, which is expected to show employers cut more jobs last month.

The dollar index was also trading 0.2% lower compared to a basket of currencies, according to the dollar index, lending support to higher commodity prices.

Energy was one of the day's strongest sectors, with the NYSE Arca Oil Index and Philadelphia Oil Service Sector Index adding 0.8% and 1.4%, respectively.

Among the integrated oil majors showing gains,


(COP) - Get Report

gained 80 cents, or 1.6%, to $49.71, as


(CVX) - Get Report

added 51 cents, or 0.7%, to $73.32. Shares of

Exxon Mobil

(XOM) - Get Report

advanced 9 cents, or 0.1%, to $65.49.

Shares for refinery firms saw particular strength.

Valero Energy

(VLO) - Get Report

rose 56 cents, or 3.2%, to $18.20, and


(SUN) - Get Report

added 96 cents, or 3.6%, to $27.64.



increased by 60 cents, or 5.1%, to $12.44.

Oilfield servicer


(RIG) - Get Report

improved by 93 cents, or 1.2%, to close at $81.19.


United States Oil Fund

(USO) - Get Report

ticked 45 cents, or 1.2% higher, to $38.80, and the

United States Natural Gas Fund

(UNG) - Get Report

climbed 5 cents higher, up 0.6%, to $8.58.

During the session,


(APC) - Get Report

raised its 2010 capital spending projections. The stock gained 47 cents, or 0.7%, to close at $70.88.


Arena Resources

(ARD) - Get Report

reported a lighter-than-expected fourth-quarter profit in the morning, hurt by increasing costs. Shares lost $7.47, or 17.5%, to $35.22.

Elsewhere on the Nymex, the April gasoline contract added 4 cents, or 1.9%, to settle at $2.20 a gallon, as the April heating oil contract improved 3 cents, or 1.6%, to settle at $2.06 a gallon. Natural gas for April delivery added 3 cents, or 0.6%, to finish the session at $4.71 per million British thermal units.

--Written by Sung Moss and Melinda Peer in New York