Oil rises as US and China manufacturing improves

Tuesday 29 January 2013 18.00
Oil prices rise on improving economic data from US and China
Oil prices rise on improving economic data from US and China

The price of oil climbed above $97 a barrel as home prices in the US accelerated and stock markets resumed their rise toward record levels.

Benchmark oil for March delivery rose $1, or 1%, to $97.44 a barrel around midday on the New York Mercantile Exchange.

Oil has not closed above $97 in New York since 14 September.

Signs of improvement in the global economy are driving the increase in oil prices.

A report Tuesday showed US home prices in November had the biggest year-over-year increase in six years.

That added to evidence showing that the housing market is recovering and outweighed a separate report indicating that higher taxes and an uncertain economic picture are sapping consumers' confidence.

Those were the latest reports in a big week for US economic indicators.

The US government will also this week release the latest numbers on weekly jobless claims, January unemployment and fourth-quarter growth. Meanwhile the Federal Reserve's policy committee is holding a two-day meeting that concludes tomorrow.

US stocks are approaching record levels after a January rally that has pushed the Dow Jones industrial average 6.2% higher this month. The Standard & Poor's 500 index is up 5.3%, its highest level since December 2007.

Brent crude, used to price international varieties of oil, rose 57 cents to $114.05 a barrel on the ICE Futures exchange in London.

Keywords: oil prices, brent