Oil resumes upward march, tops $97 per barrel
NEW YORK (AP) — The price of oil resumed climbing Tuesday, reaching its highest point since early May.
Speculation that the U.S. Federal Reserve might take action to spark the sluggish recovery and hopes for good news from upcoming debt-crisis meetings in Europe were the catalysts.
Benchmark crude added 85 cents to $97.08 in afternoon trading in New York It lost 4 cents Monday after rising for four straight days.
Brent crude, which is used to price international varieties of oil, jumped $1.05 to $114.75 per barrel in London.
Both contracts pared gains slightly Tuesday afternoon as U.S. stock indexes turned negative. The Standard & Poor's 500 touched its highest point in more than four years earlier, but the rally soon faded and left stocks down slightly by afternoon.
Traders awaited the Wednesday release of minutes from the previous Fed policy meeting for signs that it might lower interest rates. Lower rates tend to drive oil prices because they steer investors away from less-risky investments.
There was also hope for positive developments in meetings between the leaders of Germany, France and Greece later this week over the European debt crisis.
"Optimism for a breakthrough in dealing with Greece is propelling the risk appetite," said Addison Armstrong, senior director of market research for Tradition Energy.
Prices at the pump fell from a day earlier, but are still a record for the date. The national average on Tuesday was $3.717 per gallon, above the previous Aug. 21 high of $3.702 in 2008.
Retail gasoline prices have gone up about 39 cents per gallon, or 12 percent, since hitting a low of $3.326 on July 2, according to AAA, Wright Express and the Oil Price Information Service.
Other futures prices on the New York Mercantile Exchange:
— Wholesale gasoline increased 3.65 cents to $3.0673 a gallon.
— Heating oil rose 4.08 cents to $3.1339 a gallon.
— Natural gas gained 3.7 cents to $2.813 per 1,000 cubic feet.