LONDON: Brent crude oil hit a one-month high above $112 per barrel on Wednesday after the US Congress approved a deal to avert a fiscal crisis, while promising data from top energy consumer China also supported prices.
The United States averted economic calamity when lawmakers approved a deal preventing huge tax hikes and spending cuts that would have pushed the world's largest economy off the "fiscal cliff" into recession.
The deal boosted investors' appetite for riskier assets and depressed the US dollar against major currencies. A weaker greenback makes dollar-denominated oil more affordable for holders of other currencies.
Brent rose $1.00 to $112.11, its highest since Dec. 3, before easing back to trade around $111.75 by 0850 GMT. Brent averaged more than $111 a barrel last year, the highest annual average on record, after geopolitical threats to production offset worries about flagging oil demand.
US crude was up 90 cents to $92.72 a barrel, after rising earlier to $92.85, the highest since October.
"The US fiscal deal has been very positive for markets, which can now look forward to a better year ahead," said Eugen Weinberg, global head of commodities research at Germany's Commerzbank in Frankfurt.
"A combination of US monetary stimulus and Chinese growth should be very positive for commodities in 2013."
Center>Copyright Reuters, 2013
Comments
Comments are closed.