Volatility could be the name of the game on Wall Street this week as rising crude oil prices revive inflation fears and stock investors await congressional testimony from the Federal Reserve's chairman.

Investors hope the Fed's chief Ben Bernanke will speak plainly about how he sees the outlook for interest rates in the months ahead after data showing the economy is strong.

The outcome of the weekend's Group of Seven finance ministers' meeting will attract investors' attention early this week as they look to see what, if anything, is said about foreign-exchange rates.

Oil climbed back above $60 a barrel Friday as OPEC member Nigeria reduced exports and tensions grew between the United States and Iran over Iran's nuclear program. Temperatures below freezing persisted in much of the United States and spurred demand for heating oil and natural gas.

Stock trading could prove choppy if oil prices rise much further, analysts said.

"Crude and housing are the wild cards for this market," said Harry Clark, president and CEO of Clark Capital Management Group in Philadelphia. "If crude goes above $60 to $65 a barrel, that could give the market a correction."

Last week, stocks fell despite a spurt of deal news, solid profits from bellwethers such as Cisco Systems Inc.

and a sparkling market debut by Fortress Investment Group LLC . The Dow Jones industrial average fell 0.57 percent, the Standard & Poor's 500 index slipped 0.71 percent and the Nasdaq Composite Index dropped 0.65 percent.

PPI, Housing and Iran

Wall Street will get readings on inflation and the housing sector Friday, when the government releases the U.S. Producer Price Index and housing starts for January.

The overall PPI, which measures wholesale prices, is expected to drop 0.5 percent, after a 0.9 percent rise in December, according to economists polled by Reuters. Core PPI, excluding volatile food and energy prices, is forecast to gain 0.2 percent in January, matching December's increase.

Friday, U.S. crude oil for March delivery jumped to $60.80 and settled at $59.89 a barrel. For the week, oil was up 1.5 percent on the New York Mercantile Exchange.

While the spike in crude oil prices lifted shares of energy companies such as Exxon Mobil Corp., it hurt the broader market as investors began to fear the prospect of runaway inflation.

Events in OPEC member Iran, locked in a nuclear dispute with the West, have the potential to sway the U.S. stock market this week. The Middle Eastern country on Sunday marked the anniversary of the 1979 Islamic revolution. There has been speculation that as part of its festivities, Iran could announce progress in expanding the uranium enrichment capacity of its "industrial-scale" plant at Natanz.

Housing starts probably will merit more attention than usual after last week's bombshells in the housing sector. Britain's HSBC Holdings warned of rising defaults in its U.S. mortgage business that caters to Americans with poor credit histories, while luxury home builder Toll Brothers Inc. projected a 19 percent drop in home-building revenue in the first quarter.

The Reuters poll of economists forecasts a slower pace of housing starts and building permits in January. Housing starts are pegged at an annual pace of 1.600 million units, down from 1.642 million in December. Building permits are seen slipping in January to an annual pace of 1.593 million units from December's rate of 1.613 million.

A Valentine From Ben?

Bernanke's testimony on Capitol Hill is scheduled for Wednesday, which incidentally is Valentine's Day, and Thursday, starting each day at 10 a.m. Wednesday, the Fed chairman will speak to the U.S. Senate Banking Committee and take senators' questions. Thursday, he will testify before the House Financial Services Committee, and participate in a Q-and-A session with the U.S. representatives.

A recent run of strong U.S. data, including a report on unexpectedly robust fourth-quarter productivity, has prompted investors to scale back expectations for an interest-rate cut in the first half of the year.

The benchmark fed funds rate has been held steady at 5.25 percent since last June.

Financial markets now look for the Fed to stay on hold for some time.

"Anything [from Bernanke] that signals that we're heading towards an interest-rate hike, or maybe not an interest-rate decrease as fast as people want could lead to a dip down here," said Joseph Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.

Besides Bernanke, investors will keep an eye on William Poole, president of the Federal Reserve Bank of St. Louis, who will speak Thursday on "U.S. Saving" in Omaha, Nebraska.

More Data, Fewer Earnings

With the earnings season winding down, investors will seek direction from the economic data, including the international trade deficit and retail sales.

Companies due to report earnings include insurer MetLife Inc., an S&P 500 component, after the bell Tuesday, and Dow component Coca-Cola Co. Wednesday, before the stock market opens.

The international trade deficit for December will be released Tuesday at 8:30 a.m. . Forecast: $59.5 billion, up from $58.2 billion in November.

January retail sales are due Wednesday at 8:30 a.m. . The Reuters forecast calls for a 0.4 percent gain in both overall retail sales and sales excluding autos. In December, overall sales rose 0.9 percent and excluding autos, retail sales gained 1 percent.

In addition to PPI and housing starts Friday, stock investors will get a preliminary reading on February consumer sentiment from the Reuters/University of Michigan Surveys of Consumers. Forecast: 97.0, up from 96.9 for January.