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Crude Settles Ahead Despite Strong Dollar

Crude oil for March delivery gains 32 cents, or 0.4%, to settle at $77.33, even as the dollar index rises by 1%.
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) -- A flip in the


, which was recovering after the prior session's weakness, limited gains made by crude oil futures Wednesday.

Crude oil for March delivery gained 32 cents, or 0.4%, to settle at $77.33 as strong data and earnings reports lifted broader market sentiment. The contract's gains were likely capped by a stronger U.S. dollar, which rose 1% against a basket of foreign currencies, according to the dollar index.

Contributing to the market's improved mood, the

Federal Reserve


further output growth at the nation's manufacturers, and builders

picked up the pace of homebuilding in January.

The day also brought several encouraging earnings reports, particularly from


(DE) - Get Deere & Company Report

, which soared past analysts' estimates and said it expects higher equipment sales in 2010.

Late Wednesday, the American Petroleum Institute said crude oil inventories unexpectedly shed 0.063 million barrels, according to MarketWatch. Analysts polled by Platts had been expecting crude supplies to add 1.65 million barrels in the week ended Feb. 12.

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The Energy Information Administration will give its weekly inventory report on Thursday morning.

Thursday also brings the EIA's natural gas storage levels report for the week ended Feb. 12. Analysts polled by Platts are looking for a net withdrawal of 188 to 192 billion cubic feet.

The March natural gas contract rose 8 cents, or 1.4%, to settle at $5.39 per million British thermal units.

Elsewhere on the Nymex, the March heating oil contract gained a penny, or 0.5%, to settle at $2 a gallon, and the March gasoline contract also settled a penny higher, at $2 a gallon.

The NYSE Arca Oil Index slid 0.5%, while the Philadelphia Oil Service Sector Index rose 0.3%.

Exxon Mobil

(XOM) - Get Exxon Mobil Corporation Report



(CVX) - Get Chevron Corporation Report

dragged on the


, and finished the session down by 0.8% and 0.2%, respectively.

Natural gas names

Devon Energy

(DVN) - Get Devon Energy Corporation Report


XTO Energy


each beat earnings forecasts in the morning, though share prices diverged in the aftermath. Devon Energy gained 69 cents, or 1%, to close at $69.79, while XTO Energy shed 45 cents, or 1%, to finish at $46.06.

Late Wednesday,

Chesapeake Energy

(CHK) - Get Chesapeake Energy Corporation Report

narrowed its loss in the fourth quarter and beat Wall Street profit expectations by 7 cents. The shares finished the session 2.1% higher at $26.36 but were losing 21 cents, or 0.8%, in after-hours trading.

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