Oil prices reach ten week high
Oil prices jumped by the most in weeks yesterday, with US crude reaching its highest in more than two months as technical buying and signs of speedier efforts to avert a US fiscal crisis fueled an abrupt year-end rally.
After trading about $ 1 a barrel higher earlier in the day, oil prices jumped by another $ 1 in the early US hours.
Brent crude held most of those gains by mid-morning, up $ 1.76 or 1.6 percent at $ 110.56 a barrel by 1530 GMT, on track for its biggest one-day rise since mid-November. Volume was about one-sixth the average.
US crude led yesterday's gains, up $ 2.17 from Monday's close to $ 90.77 a barrel, but trading activity remained subdued.
About 150,000 lots had changed hands, roughly a third of the daily norm.
Oil prices dropped more than 1 percent on Friday after US fiscal talks dissolved when Republican lawmakers withheld support for a proposal to avert a raft of tax hikes and spending cuts, but many investors doubt that lawmakers would risk tipping the fragile US economy into recession again.
Friday's intraday low for WTI crude was a major 50 percent retracement mark, and $ 88 a barrel was a "big level that a lot of people were watching", Bill Baruch, senior market strategist at iitrader.com LLC in Chicago, told Reuters.