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Oil price rises to near US$98 per barrel
Source: Agencies |
November 11, 2011, Friday
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OIL prices jumped more than 2 percent yesterday as investors cheered political shake-ups in Greece and Italy, and layoffs appeared to be easing in the US.
Benchmark crude rose US$2.04, or 2.1 percent, to finish at US$97.78 per barrel in New York. Brent crude rose US$1.40 to end at US$113.71 a barrel in London.
Greece and Italy turned to economists to lead them out of their debt crises. Greece chose Lucas Papademos as prime minister. In Italy, Mario Monti received increasing support to replace outgoing Prime Minister Silvio Berlusconi.
Those countries continue to face massive financial hurdles, but the leadership changes were taken as a sign that Italy and Greece are serious about reducing their debts. A default in either country would be devastating for the world economy, possibly leading to bank failures, a drop in spending and weaker oil demand elsewhere.
Investors were also encouraged to see that Italy could still raise money by selling nearly US$7 billion in 12-month bonds. The interest rate was well below analysts' expectations, implying stronger-than-expected confidence in the Italian economy.
"Their economy still has a lot of problems, but that bond sale showed it's not as bad as feared," PFGBest analyst Phil Flynn said.
There was also some upbeat economic news in the US yesterday. The Labor Department said that the number of people applying for jobless benefits fell last week to 390,000 - the lowest level since April.
In other energy trading, heating oil rose 5.25 cents to finish at US$3.1511 per gallon, while gasoline futures fell less than a penny to end at US$2.6368 per gallon. Natural gas finished virtually unchanged at US$3.65 per 1,000 cubic feet.
Benchmark crude rose US$2.04, or 2.1 percent, to finish at US$97.78 per barrel in New York. Brent crude rose US$1.40 to end at US$113.71 a barrel in London.
Greece and Italy turned to economists to lead them out of their debt crises. Greece chose Lucas Papademos as prime minister. In Italy, Mario Monti received increasing support to replace outgoing Prime Minister Silvio Berlusconi.
Those countries continue to face massive financial hurdles, but the leadership changes were taken as a sign that Italy and Greece are serious about reducing their debts. A default in either country would be devastating for the world economy, possibly leading to bank failures, a drop in spending and weaker oil demand elsewhere.
Investors were also encouraged to see that Italy could still raise money by selling nearly US$7 billion in 12-month bonds. The interest rate was well below analysts' expectations, implying stronger-than-expected confidence in the Italian economy.
"Their economy still has a lot of problems, but that bond sale showed it's not as bad as feared," PFGBest analyst Phil Flynn said.
There was also some upbeat economic news in the US yesterday. The Labor Department said that the number of people applying for jobless benefits fell last week to 390,000 - the lowest level since April.
In other energy trading, heating oil rose 5.25 cents to finish at US$3.1511 per gallon, while gasoline futures fell less than a penny to end at US$2.6368 per gallon. Natural gas finished virtually unchanged at US$3.65 per 1,000 cubic feet.
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