afternoon buying, page-16

LONDON (Reuters) – Oil rose further over $71 a barrel on Thursday, buoyed by weakness in the dollar and bullish data on Chinese and U.S. crude inventories.

U.S. crude rose 45 cents to $71.48 a barrel by 0845 GMT, while Brent crude gained 55 cents to $71.40.

"Recently, the oil market is looking more at the correlation between the euro and the dollar," said Ryuichi Sato, an analyst at Tokyo-based Mizuho Corporate Bank.

The dollar fell toward $1.40 against the euro after tame U.S. inflation data dampened speculation the Federal Reserve would raise interest rates by year-end.

A weaker dollar makes oil and other commodities cheaper for holders of other currencies.

Oil prices have been trading in a tight range around $70 a barrel over the past week, as investors assess whether the rally which has seen prices more than double since February can continue.

Many analysts, including Sato, are eyeing a key price target of $76 a barrel, established last year when oil crashed from record highs near $150 a barrel in July to lows close to $30 a barrel at the turn of the year.